Recognizing that most identities may be available for sale on the dark web is a frightening proposition. Adding to that concern is the fact that one can acquire an identity and an instruction kit for as little as $8 on the dark web. The fraudsters are instructed to open accounts with various Fintechs using the credentials that they purchased. They are able to easily open and load the accounts with the information acquired. The fraudsters must load these accounts and then typically wait for 30 days to ensure that the new account protections that the bank depends on have lapsed.
After the 30-day waiting period has ended, fraudsters will begin to use the card to conduct their affairs and will then begin to dispute those transactions. Each account typically generates between $1,000 and $1,200 before it is closed. In the current state, there is no consequence for the fraudster or the actual owner of the ID that was stolen. The banks and their program partners suffer the losses incurred.
When the fraudsters complete their Fintech scheme, they are now ready to move into the credit world and take out a line of credit or credit cards in the ID Theft victim’s name. This is when the damage is done to the original owner of the ID that was compromised. It could be months into the scheme before the victim has any visibility to the compromise.
With Neighborli, members of the network can notify fellow members of the fraud incurred to ensure that it does not continue. This will create an impediment to the fraudster that is now able to operate with no consequence in an effort to optimize the original investment. By creating a monitoring mechanism, Neighborli can notify its members of the compromised identity to mitigate the fraud that would follow. Importantly, Neighborli can protect the individual that was compromised before his/her credit is damaged. By leveraging its connections with the credit bureaus and other ID Theft protection companies, the owner of the compromised ID will be alerted to a potential risk to their credit. This pro-active, meaningful alert will allow the consumer to put adequate protections in place to prevent further misuse of his/her identity.
In this case, Neighborli can reduce the damage done to an individual who has had his/her identity compromised and will prevent losses for the Fintech banks and programs.
