What is Document Fraud?
Each year, document fraud costs billions of dollars to the global economy and it keeps growing because of the expansion of digitization and the increase of remote customer onboarding, especially in the banking and government sectors, where document fraud is a very high risk.
Among the most common types of fraud, identity theft is apparently the most popular. All techniques are good to achieve identity theft: forgery, document falsification, blank documents theft…
Once the identity is stolen, fraudsters can carry out numerous actions: open a bank account and get loans, open cellphones accounts, withdraw money…
ID theft is impossible to detect by solely checking the ID document, as the ID card is a real document presented by someone who is not the legitimate holder. Only cross-checking can detect impersonation.
Who is affected by document fraud?
In recent years, many other sectors, outside financial businesses, have been impacted by document fraud.
For example, online gambling, as well as the collaborative economy (home rental, carpooling, second-hand sales, service exchanges) have had to deal with a continuous increase in identity crime.
These new economic models are exclusively based on remote and online client relationships. Identification isn’t always easy to carry out and fraud cases such as identity theft are multiplying.
The cost and impact of document fraud
Experts are divided on the exact cost of identity theft, but the overall figure approaches tens of billions of dollars per year.
According to the U.S. Department of Justice, 26 million people in the U.S. were victims of identity theft in 2016, for a cost of $17.5 billion.
Identity theft not only is costly but it has tremendous psychological consequences and victims have to prove that the fraudulent transactions were not of their making.
What are the consequences for companies?
However, even if ID-issuing institutions implement and use security techniques to combat document fraud, it isn’t always sufficient.
Fraudsters constantly develop sophisticated techniques, forcing companies to be more vigilant trying to avoid financial losses. Integrating fraud protection services becomes essential.
The thing is, fraud doesn’t affect ID documents only. Many other documents, required during certain online subscriptions can be forged, falsified or stolen…
Which items are subject to document fraud today?
Fraudsters’ motivations are multiple, whether it’s to benefit from a good or service or to escape legal proceedings.
Document fraud affects ID documents, but also many other documents which are called “supporting documents”: invoices, pay slips, bank details, contracts, etc. Many of them don’t have integrity measures, so modification is easy without it being visually noticeable.
All the identity informations on ID documents will be of interest to fraudsters: name, first name, date of birth, sex, place of birth, ID number, ID photo, signature of the holder.
Among fraud-prone documents, Fraudsters appreciate national ID cards, drivers licenses, passports as well as health cards.
In certain cases like signing a lease agreement, renters have to provide several documents including an ID, last pay slips, an employment contract.
The same applies to governmental sectors, administrations and public services, which often request numerous sensitive documents such as tax certificates, proof of residence, health or legal documents.
For example in France, when a citizen wishes to get a “Crit’Air” sticker for their car (air quality certificate which classifies vehicles according to their polluting emissions), they will have to provide an identity document, a car registration certificate as well as a proof of address matching the address on the car registration.
So, taking into account the diversity of documents required for all types of onboarding processes, how can we fight document fraud as effectively as possible?
What techniques are used to fight against document fraud?
ID Verification Process
To face the massive fraud increase due to the digitization of services, there are solutions that allow you to automatically and instantly verify the ID document of a person, and prove that the holder of the document is really who they claim to be.
How it works is quite simple: the user captures his or her identity document on the web or on mobile, then takes a selfie or a video. Thanks to deep learning technologies, the solution analyzes in real time the submitted document as well as the biometric capture in order to compare and cross-reference the different data.
Once the analysis is completed, the user receives a real-time verdict on the authenticity, validity and conformity of his document. This ensures that the user who wishes to authenticate to the service is who he claims to be behind his screen.
To go further in the security process and since August 2, 2021, all european member states must follow a Regulation that requires them to adopt a new format of national ID card.
This new format is now equipped with a microchip, a technology that contains the printed identity data in a forgery-proof form.
In addition to usual automatic reading controls carried out via an OCR tool (optical character recognition), checking and analysing the chip by all KYC solutions with remote NFC reading is simple, quick, reliable and secure.
NFC, or Near Field Communication, is a contactless technology that allows data exchange between 2 compatible devices. This technology doesn’t require any application since bringing the two devices up close together is enough so that the contact and reading can take place. It’s been used for a while in passports, but it can also be found in contactless payments, mobile payments, reading of tags similar to QR codes, or even transport card validation terminals.
2D-Doc & QR code
The QR code is increasingly used and often confused with the 2D-Doc. Let’s take the example of the vaccination certificate which combines and uses both 2D-Doc and QR Code technologies:
- The 2D-Doc contains and secures the person’s identity and vaccination data.
- The QR Code contains a hyperlink that launches the “TousAntiCovid” application to save the 2D-Doc. The 2D-Doc thus acts as a reliable data source and the QR Code as a means to apply this data quickly and concretely.
The 2D-Doc is based on a public standard maintained by the Agence Nationale des Titres Sécurisés (ANTS) and the information allowing its reading and verification is published openly on its website (https://ants.gouv.fr/Les-solutions/2D-Doc).
In theory, anyone can read a 2D-Doc, in practice, the analysis of a 2D-Doc requires the implementation of technological processes which can be complex: image capture, 2D-Doc decoding, electronic signature verification, etc.
Use cases of 2D-Doc
At the moment, the 2D-Doc specification in its version 3.1.3, allows the security of 36 different types of documents.
The most popular examples of 2D-Doc implementation in France in 2021 are the new national ID card, the vaccine certification, and virology test results. Older examples exist such as bills (energy supplier, telephone company, etc.), the Crit’Air sticker, or income tax notices.
Only 3 solution suppliers are approved by the ANTS: ARIADNEXT, Dhimyotis and the ANTS. All three have authority to issue RGS* level certificates (Référentiel Général de Sécurité 1 étoile) allowing to digitally sign the 2D-Doc. Thus the 2D-Doc analysis and the validation of its electronic signature contains the issuer’s verification.
Secure your future transactions
Faced with companies’ growing concerns of document fraud, which as we have just seen, doesn’t only concern identity documents, it’s time to act in favor of securing the customer onboarding processes.
It’s now possible to integrate a remote ID verification solution, capable of both ensuring the authenticity of an ID document, biometric or not, and of its holder.
For supporting documents, whether printed or electronic, a 2D-Doc application ensures that they weren’t falsified. With a code that’s easy to check, the self-carrying device guarantees the conformity and confidentiality of sensitive data.