Digital age verification solutions have the ability to detect fraud by verifying the identity of the customers during the initial stage of customer onboarding.
While the internet has opened doors to countless new opportunities, there is a downside. Online scams are increasing in number with every passing day, wiping out millions from a company’s bottom line. While you may think that senior citizens are the key targets for fraud, studies state otherwise. The Federal Trade Commission (FTC) reported that millennials are more vulnerable to online scams than boomers. Safeguarding customers from online fraud is a major challenge faced by online businesses today. Fortunately, age verification solutions can detect fraud within seconds and save companies from facing major lawsuits.
What are Age Verification Solutions?
Age verification solutions are AI-based tools that have the ability to verify individuals based on their age. Age checks are necessary for sellers of age-restricted products, which include tobacco vendors, e-cigarette companies, telemedicine firms, etc. Without the use of such solutions, these vendors risk breaching laws such as the Children’s Online Privacy Protection Act (COPPA) in the US.
How Do They Work?
Suppose you decide to visit an online gambling site to see how it works. Before you’re allowed to open an account, you will be required to prove your identity as well as your age. If the website has employed traditional methods of identity verification, age verified users are onboarded simply after users manually input their date of birth. However, this method of age verification has proven to be quite unsuccessful, as minors can misstate their date of birth to access the platform.
AI-based age verification solutions overcome this hurdle by verifying end-users in real-time. When users reach a platform such as an online dating site, they are required to prove their age and identity by displaying their official ID cards. Age verification solutions use Optical Character Recognition (OCR) technology to extract data from the ID documents through an automated process. After data extracted, it is verified and results are displayed within seconds.
What Types of Fraud can Age Verification Detect?
Age verification solutions can detect a number of frauds that are targetted at age-restricted sites. Some of them are listed below:
- Fake Identities
Cybercriminals are known to use advanced technologies to fool security systems such as age verification online. Fraudsters steal customer data from company data breaches or phishing attacks and combine it with fake information to forge new identities. The fake identities are then used to commit other scams, such as manipulating users on online dating sites. Age verification checks weed out fraudulent players by verifying them through information such as their name, age, and place of birth. In case of any discrepancy, access to the platform is denied.
- Fraudulent Documents
To purchase items off the internet, such as e-cigarettes and vapes, customers are required to submit their identity documents as proof. This process has become mandatory for online businesses under regulations such as Know Your Customer’s Customer (AML) and Anti-Money Laundering (AML). KYCC procedures require age verification so that only authorized customers purchase the products. If any fraudulent document is submitted, age verification solutions can instantly detect it and alert the staff members.
- Minors on Adult-oriented Platforms
KYCC procedures are not only implemented to keep fraudsters at bay. In this day and age, minors have become tech-savvy and are using various methods to access adult-oriented websites such as online casinos. Such tactics also fall under the category of fraud, as the users provide fake details to visit such platforms. What makes it even more alarming is that criminals prey on minors on such platforms and solicit them for personal details and cash. This can have dire consequences for the minors as well as the company through which the crime was committed. Digital age verification solutions provide companies with the ability to comply with minor protection laws, keeping minors away by scanning their age during the KYCC process.
Summing it Up
When it comes to maintaining internet security, verifying users on the platform plays a significant role. Online businesses that sell age-restricted goods and services but have not deployed age verification solutions might face major challenges in the form of legal repercussions on top of financial penalties. These solutions provide e-commerce sites, online casinos, dating platforms, etc. the best mechanism for growing a clean customer base. Firms that aim to sustain themselves in a highly competitive market must verify the age, name, and similar identity details prior to onboarding customers. By doing so, underage access to age-restricted platforms can be minimized along with child exploitation, and loss of money to financial frauds.
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