ID Analytics, the San Diego-based company that uses data from a national ID network to score identities, is launching a national study of identity fraud in the U.K. that the company will use to establish its business overseas.
ID Analytics was founded in the spring of 2002 by veterans from Fair Isaac, HNC Software, and the financial and telecommunications industries. After launching a national study of identity fraud in the United States, ID Analytics unveiled its ID Network.
Data is added to the ID Network by ID Analytics customers, including market leaders among bank and retail card issuers, wireless carriers, online retailers, banks, and public agencies. The network includes hundreds of millions of identity fraud indicators. Hundreds of thousands of additional fraud indicators are added to the network daily.
Once patterns emerge, members of the network can check new accounts, for example, and determine whether an applicant is who they say they are using a scoring method much like a credit report.
The companys plan for the U.K. is much the same, though the results of the study expect to be quite different, said Steven Gal, vice president of corporate development and general counsel at ID Analytics.
We already know there are different issues [in the U.K.], Gal told InsideID. Generally, the approach in the U.K. is the same.
There are no Social Security numbers in the U.K., for example, and Social Security numbers are a common mechanism for identity fraud in the United States. In the U.K., a persons address is very important to establishing their identity, Gal said.
Much like its parent company did in the United States, ID Analytics Ltd. is working with the U.K.s leading banks, mobile operators, credit card issuers, and retail consumer finance companies. The study is backed by such companies as HSBC Holdings plc, Capital One, and O2. The U.K.-based Association for Payment Clearing Services (APACS) is also lending its support.
As for the scope of the problem in the U.K., the City of London Police Fraud Squad has estimated that fraud accounts for losses of £14 billion to the U.K. economy annually. A recent survey by the CPP Group found that 90 percent of Brits are worried about identity theft.
Privacy laws in Europe are also much more strict that in the United States. But Gal said ID Analytics went above and beyond the expectations of privacy organizations in the United States and will do the same in the U.K.
The data in the companys network is used only for the prevention of fraud. It is not sold or used for any other purpose. Personally identifiable data is not delivered outside the network, just the ID scores.
One of our basic goals as a company is trust, Gal said. He defines trust as an equation: trust equals value times security times privacy. We invest and over-invest in security.
As for privacy, ID Analytics Ltd. will meet or exceed all privacy laws in the U.K.; meet or exceed consumer organizations requirements; and meet or exceed consumer expectations, Gal said. Were very open up front with all the participants.
In the next 12 months, ID Analytics expects to expand even further outside the United States, to Australia, Japan, and Korea. As its networks grow to encompass more identities, Gal said he expects to see interesting international patterns emerge because identity theft is, after all, an international problem.
The data that is collected in each country will remain in its country of origin, but ID Analytics expects to use the patterns it finds globally.
I have no doubt well se different patterns in the U.K. than we see in the U.S., Gal said.
Allen Jost, Chief Technology Officer for ID Analytics, will be speaking at the Inside ID Conference & Expo, Nov. 15-17, 2004, in Washington, D.C.
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