Financial institutions face constant pressure to adhere to regulatory mandates designed to prevent identity fraud and money laundering while still delivering excellent customer support, watching bottom-line results, and meeting business objectives. In today’s complex business environment, this may seem like a nearly impossible task. However, those regulatory mandates also create many opportunities to improve efficiencies and save money. By integrating identity verification into the overall risk management strategy, financial institutions can expect to see substantial benefits with their bottom lines, customer support levels, and employee productivity.
For today’s financial institution, identity verification is just a critical aspect of establishing a new relationship. True identity verification means reviewing the truthfulness of just what a prospective customer discloses by screening the information against multiple sources, then analyzing the important points to ascertain whether a new relationship must be started. “Know your customer” has for ages been promoted within institutions as an indication of personalized customer support; however, with the enactment of the USA PATRIOT Act regulations, identity verification is currently the difference between success and failure in the ever-changing financial services market.
Exactly why is identity verification important to financial institutions?
The increased role of the country’s financial institutions in securing the house front must not be undervalued. The purpose behind the USA PATRIOT Act is national security. No body will disagree that having a much better comprehension of the customer working at an organization provides increased security for the institution, its customers and the public in general.
The danger for banks is more than monetary loss. 먹튀 Injury to an economic institution’s reputation developed by noncompliance and the publicity surrounding terrorists opening accounts can lead to lost confidence in the institution and significant loss of customers, sales, and revenue. Recovering from negative publicity is just a long, difficult, costly process.
Institutions need to prevent identity fraud while balancing the need to protect customer information with a customer’s requirement for quick, efficient service. Identity verification is clearly a first faltering step in reducing the opportunities for fraud and taking action. Stopping the “bad guys” from opening a new account at an organization is the simplest and most cost-effective way to lessen a bank’s burden. That’s how “knowing your customer” can help–if identity verification becomes part of the defensive measures within the overall risk strategy, it can be quite a significant factor in preventing fraud.
Increasing Operational Efficiencies
The USA PATRIOT Act has driven financial institutions to examine corporate policies and perform lengthy risk analyses. Identity verification technology helps integrate policies into normal routines by allowing frontline workers to gather needed information very quickly and efficiently rather than manually researching identity information by calling references and checking websites.
From airline happen to be school registration to doctor visits, society is used to trading some privacy for the security of every person and the country. However, customers do expect their financial institutions to safeguard their identity information and their fiscal assets. Identity verification programs allow new accounts to be opened quickly, developing a positive experience for the consumer while showcasing the methodology the institution has in place to safeguard its customers.
Determine perhaps the customers appear on any list of suspected terrorists or terrorist organizations(2)
You’ll find so many solutions to help banks implement identity verification programs to adhere to the regulations, always aiming to create educated and proactive decisions about customers. The USA PATRIOT Act regulations allow a documentary or nondocumentary approach.
Documentary Solution
Traditionally, the utilization of manual or documentary solutions for identity verification has been prevalent in the financial services community. At many institutions, a member of staff will appear at a driver’s license or passport to start account-opening procedures. Institutions are relying on driver’s licenses and passports to be valid, but with the recent upsurge in forgery, it’s difficult to own confidence that the documentation is legitimate.
Nondocumentary Solution
Since the enactment of the USA PATRIOT Act, technology has improved within the region of identity verification. Identity verification technology supplies a simple approach to integrating a CIP into an institution’s risk management strategy. Furthermore, identity verification technology gives an organization a cost-effective tactic for keeping up-to-date with ever-changing regulations.
For true identity verification, it is crucial to screen presented data against multiple independent sources to make sure consistency. Checking one source won’t provide enough information, and there is no database that includes everyone surviving in the United States. This means an organization must concur that the name, Social Security number, address, and date of birth are valid and associated with one another using various data sources. If the info is unvarying throughout multiple sources, the institution may make an educated decision that it is truthful. By utilizing identity verification technology, organizations can have the various tools, not just to verify identity, but and to screen against government lists and document transactions. Institutions can completely adhere to the regulations, while also realizing the benefits of protecting against fraud, increasing operational efficiency, and improving customer support levels.