Could you be doing business with criminals and not know it? Find out how to identify and verify electronic signatures to prevent fraud.
When you do business with any person or company, you need to know 100% without a doubt they are actually who they say they are. Criminals often commit fraud by either assuming another person’s identity or creating an identity of a person who doesn’t exist.
Organizations involved in a fraudulent business deal typically lose both money and customer trust. Additionally, the organization must take time to resolve the fraud and possibly prosecute the criminals—time that could be better spent on literally anything else.
That’s why identity verification is an essential step of the eSign process.
The High Costs of Fraud
Let’s say a bank approves a loan based on an online loan application. Through digital processes, the loan is funded and the paperwork is signed using electronic signatures, which allow financial institutions to expand their customer base regardless of location. However, this loan was granted based on a fraudulent identity. Because the information on the documents was falsified, the bank will neither see repayment nor be able to pursue collection processes.
Real estate is another industry where fraudulent activities are common. Watch a recent real-world story in Toronto where homeowners discovered their home was sold without their consent or knowledge.
This type of fraud has become easier to commit partly because the pandemic forced a shift from in-person transactions—where proper identification must be shown and verified by people—to fully electronic transactions. Now, even with the capability to do business in person, many organizations have elected to keep the flexibility and convenience of electronic transactions and eSigning.
Industries and organizations at high risk for fraud need more than a simple eSignature solution. A high-trust eSignature solution is required that integrates and verifies identities via approved eID schemes and tamper-proof PKI technology.
The bottom line is prosecuting fraud is challenging, expensive and exceptionally time consuming. But the good news is eSign fraud is preventable with secure processes, identity verification, and trusted technology.
4 Ways to Prevent Document Fraud
Protecting your organization from fraud is a key pillar in offering “high-trust” documents. By choosing an eSignature platform that uses best-in-class identification services, you can verify a signer’s identity using government-driven identification methods. You can also use eSign authentication that involves trusted third parties, such as bank and telecommunications companies.
Here are four keys to fraud protection for your business:
1. Choose an eSign platform with multiple levels of identity verification. The most stringent identity verification processes are time consuming and cumbersome. Choose an eSign platform that offers multiple signature types and verification options aligned to the specific trust level needed for the signer and the document. For example, a loan application submitted by an unknown person on the internet needs a higher level of identity verification than renewing a current employee’s contract.
2. Allow the customer to choose the eSign identification method. When a customer can select the online authentication method that both meets the requirements for the document and their comfort level, they are more likely to complete the process. Additionally, they are less likely to become frustrated with the experience. Even though the customer selects the method, such as government ID or telephone verification, the eSign authentication process will help identify and stop criminals posing as other people.
3. Use tamper-proof technology. By using an eSignature platform that uses cryptographic seals, signers cannot alter the information in the document after it’s signed, which prevents many types of fraud. Additionally, the seal tracks all interactions—such as signatures, transfers and modifications—through a built-in audit trail.
4. Provide integrated identity verification. When you use a third-party app or service for identity verification, you allow more opportunity for fraud. With an eSignature platform that includes integrated ID verification, you can effectively combat fictional or stolen identity crimes.
See How Nitro Helps You Prevent Fraud with eSign Verification & Authentication
Nitro is committed to providing a leading high-trust electronic signature solution that helps you prevent fraud on many levels. Nitro Sign Premium connects to electronic ID (eID) and other public identity initiatives around the world. Your organization can be confident every signer undergoes the highest level of eSign verification based on the trust level you choose.
If you are interested in a demonstration of our high-trust eSign platform, contact our experts to get started.