ID Fraud banks - Know your customer

ID fraud on banks - do you trust your customer?

23 april 2019

As a bank, you need to be cautious about who you do business with. Consumers and companies can cause you significant financial harm. They could scam and defraud you by taking out a loan. But the loan payments might never come. This issue can be avoided. In this blog post, you’ll read what your bank can do.

Dutch bank victim of embezzlement

In the past, there have been cases of fraudulent activity and scams against banks. A great example is the 5.6 million euro embezzlement committed in 2010. The perpetrators succeeded in depositing the money into the bank account of a 26-year-old man from Wageningen in The Netherlands. He then transferred the funds to several accounts abroad. Ultimately, 13 suspects were arrested. With help from foreign banks, 2 million euro was recovered.


Scammed through a bank account

In recent years, there has been an increase in people who have been cheated out of money via bank transfer fraud. Someone will transfer funds to an individual who has accounts with a different bank. But then the person receiving the funds doesn’t hold up their end of the agreement and is never to be heard from again. You are unable to reverse the transfer, and your bank can only suggest that you file a (police) report or consumer complaint. Banks can avoid this problem by implementing a KYC process.

What can banks do?

As a bank, you want to protect your clients’ personal information as securely as possible. That’s why a client never receives codes, cards, etc. all at the same time, and, for as many actions as possible, users are required to identify themselves each time.

However, should your bank fall victim to identity fraud, that would not only impact you financially, it would also affect your public image. Despite informing consumers as clearly as possible about a suspected case of identity fraud, that information is usually too little, too late. Your bank’s security needs to be outstanding since you are ultimately in charge of ‘guarding’ your clients’ money. That makes it important to know your customers very well.


Know your customer

As a bank, you definitely don’t want to run the risk of fraud. Getting to know your clients is essential in avoiding cases of fraud. That’s why we offer the KYC (Know Your Customer) solution. A KYC process can be set up in a variety of ways: from collection and analysis based on identity information to assessing a client’s risk level.

Would you like to learn more about keeping your banking business safe?

Discover KYC