Identity Resolution Daily

Douglas Wood, Infoglide Senior VP

I confess. I have ‘borrowed’ some product and sales messages from people outside of the company from time to time. But, in fairness, these people are usually recognized industry experts. Take Ken Rijock, for example. Mr. Rijock is a former banking attorney at an international law firm. He’s also a former money launderer. He spent the 1980s as a money launderer and adviser to drug traffickers until he was arrested and served a U.S. federal prison sentence for racketeering and money laundering. I recently re-read several installments of his Confessions of a Money Launderer series, which outlines a serialized account of his escapades while on the other side of the law.

We previously posted about Mr. Rijock’s writings back in October of 2007, but the information seems just as relevant today as it did back then. The issue of Anti-Money Laundering (AML) continues to be front and center for the global financial services industry, and as a group we continue to learn new and innovative ways to solve the problem.

To that end, the American Bankers Association (ABA) holds its annual Anti Money Laundering Conference in Washington, DC, next week. Beginning Sunday, November 13th, the conference runs through Tuesday the 15th and looks to be very well attended once again. The conference is a great venue for BSA/AML compliance officers, in-house and outside counsel, fraud officers and investigators, bank auditors, regulatory officials and consultants. According to the ABA, this conference reflects “must have” content for BSA/AML compliance professionals.  It’s hard to argue that statement, given the robust agenda that has been put together.

The lineup of speakers this year includes the ABA president Mr. Frank Keating and the director of Financial Crimes Enforcement Network (FinCEN), Mr. James Freis. Additionally, a solid lineup of key industry players are involved in the sponsorship of this year’s event, including Infoglide Software Corp., LexisNexis, NICE Actimize, Palantir Technologies, and World-Check (home of the Confessions of a Money Launderer series).  Infoglide, who hosts this industry blog site, will be at Booth 407 exhibiting their industry-leading Identity Resolution Engine (IRE) product for Fraud and AML detection/investigation.  Please come by and visit us, because I truly believe that we have ‘borrowed’ all of the right pieces from industry experts to make our technology a viable solution for the banking and financial services industry.

There.  I’m glad I got that off my chest.

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by Douglas Wood, Infoglide Senior VP

On the heels of recent news that the Infoglide-powered TSA ‘Secure Flight’ program has received a 2011 Technology Innovation Award from Government Computer News comes word that FICO, the leading provider of analytics and decision management technology, has announced that it is enhancing its risk management and fraud detection applications by incorporating Infoglide’s market-leading Identity Resolution Engine® (IRE) software. Infoglide’s IRE will serve as the identity resolution engine and link analysis solution across FICO’s suite of fraud detection and risk management products, which include the industry-leading FICO™ Falcon® Fraud Manager for credit grantors and FICO™ Insurance Fraud Manager.

More:  See the announcement here.

Having worked with the leadership team at FICO now for many months, I can attest to their deep underlying commitment to bring only the best analytic capabilities to market. With the tight integration of Infoglide and FICO products, fraud investigators can identify customers with greater precision, and use link analysis to find connections between transactions, people, third parties and discrete fraud events that can reveal previously hidden fraud schemes. The combined capabilities expand the view of the fraud investigator and enable the identification fo more complicated fraud patterns, criminal fraud rings, and networks of collusive participants that might otherwise appear disconnected from the fraud problem.

Infoglide is thrilled to be teaming with an undisputed market leader, and we are already working diligently with their product team(s). FICO will first focus on integrating Infoglide’s capabilities with FICO Falcon Fraud Manager and FICO Insurance Fraud Manager, in order to enable the many users of these solutions to drive more effective fraud investigations and prevent the most complex fraud schemes, often involving multiple individuals and organizations.

As part of the partnership commitment by both parties, Infoglide will be attending FICO World in New York City from November 1 – 5.   I hope to see you there!

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By Mike Betron

Infoglide VP and GM of Social Identity Services

In the hit television series 24, Jack Bauer needed accurate information for split second decisions in “real time.” It was a matter of life or death for the characters in the show - even subtle discrepancies could mean the difference between Bauer trusting someone or deciding that he or she was a terrorist. Knowing the facts - in their most current status - was imperative for him to function. On the show, Bauer could rely on Chloe, his contact at the Counter Terrorist Unit to give him the latest assessment of the situation so he could decide on his next course of action.

For most financial institutions, however, finding a person of interest is not as simple as dialing up Chloe. In a recent survey commissioned by Infoglide to 230 managers, directors, and VPs in charge of managing fraud/risk/security at the top 100 banks in the US,  over a 1/3 of all participants responded that their most critical challenge to solving fraud was their inability to effectively find persons of interest in real time across all of their data. Oftentimes, even when a bank has usable information, they can’t put the pieces together in time to solve the puzzle.

Part of the issue lies in the massive quantities of data that financial institutions have to search through. According to our survey, the average investigator at a bank searched four different systems, with many of the larger banks needing to search over 7 data sets or systems.  

Another issue identified in the survey is the lack of data sharing between departments. For example, less than half of all banks even share a common case management tool across their departments.  Collaborative efforts are either manual or nonexistent for over 50% of all banks. John Doe might be defrauding the commercial side of the bank and laundering his newfound wealth, but the bank is not be able to pinpoint that it is the same person. Where is Chloe when you need her?

Banks that suffer these issues should strongly consider Infoglide Identity Resolution Engine (IRE). With IRE, they can connect to all of their data sources – internal and third party - to search for persons of interest in real time.

The stakes may not be life or death, but with banks under increasing regulatory and compliance pressures, there exists the same Bauer-esque need to make good decisions in real time about the interactions they have with customers.  Missed opportunities to stop fraud and/or money laundering are costly and painful.  Sorry, Chloe… but IRE has your job now.  It provides the real time intelligence, real time threat detection and real time decisions that you used to give to Jack… 24 hours a day.

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By Michael Shultz - Infoglide CEO

Infoglide Software Corporation would like to congratulate their TSA Secure Flight program team in Annapolis Junction, MD, as one of the ten projects chosen for Government Computer News (GCN) “Outstanding 2011 IT Achievement in Government.” As regular readers of this blog know, Infoglide’s identity resolution technology sits as the core risk engine of the Secure Flight program.

According to GCN.com, “The teams behind the winning projects, chosen from a list of more than 200 nominated, share a commitment to drive down costs and displayed the leadership and engineering skills needed to put the power of some of the worlds biggest computer facilities into the hands of individual citizens and professional end users.”

An article on GCN.com explains the program thusly:  “After Sept. 11, 2001, when airlines failed to coordinate a successful watch list system on their own, the 911 Commission recommended TSA take on the challenge. With the Secure Flight Program, TSA put its IT brain trust up against the daily threat of deadly force. The challenges were unprecedented: perform real-time matching for all flights, including reservations made in advance and at the last minute, while permitting airlines to submit data up to 72 hours before departure. Secure Flight set up new processes, data exchanges, applications, IT hardware and infrastructure, and established support systems for a consistent watch-list matching process. The management and technical ingenuity behind the project has stood the test of time for 10 years.”

A leading provider of entity analytics software for critical cross-database ‘Search / Match / Link’ applications, Infoglide Software provides technology that allows single-request searching into multiple databases without the need to move or clean data.  With a best-in-class library of over 50 algorithms accounting for variations in names, addresses, dates and other attributes, the technology points to who’s who… and who knows whom… despite data quality problems and/or deliberate attempts to deceive. 

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By Douglas Wood, Infoglide SVP of Sales and Services

I noted with interest the August 31 announcement that IBM is buying UK based i2 Inc.  I was in my hotel room when I read the announcement, attending the International Association of Financial Crimes Investigators (IAFCI) conference in Charlotte.  I was actually so surprised that I dropped one of my shoes onto the floor as I was hurrying out of the hotel room.

Perhaps I should not have been so shocked, though.  It was clear to me that the 2009 COPLINK/i2 ‘merger’ never quite developed the way either party had intended, and that neither entity was working particularly well with the other. Looks like IBM saw the same thing and swooped in to put the pieces together.  Good play on their part.

With loads of customers in several countries, i2 is a large provider of intelligence analytics for crime and fraud prevention serving the banking, defense, health care, insurance, law enforcement, national security and retail markets.  I suspect that IBM’s plans will include integrating the i2 and COPLINK platforms into the overall Infosphere portfolio, particularly the Identity Insights solution formerly known as Entity Analytics Solution (EAS).  With a new base of customers in which to up-sell software and services, IBM looks well positioned to take on SAS and other behemoth players in the fraud analytics business.  Or are they?

I don’t expect SAS to sit on its hands.  They never do.  Although more traditionally thought of as a NIH shop, I would expect some rapid bulking up on their part.  And what of HP?  The acquisition of Autonomy was interesting to say the least.  I find it hard to believe they are going to stop there.  Even BAE Systems is ready with their recent purchase of Detica/Norkom and the Netreveal platform.

In the meantime, startups such as Palantir Technologies and Infoglide Software continue to make major strides in building our respective next-gen technologies and customer bases. I am particularly proud of our Identity Resolution Engine product and MinorMonitor offerings.  The former provides cross database single-request fuzzy searching, social link discovery, anonymous resolution for data privacy and real time red flag analytics for commercial and government clients.  MinorMonitor is our free web tool that – using the same core technology used to keep terrorists off of airplanes - alerts parents on what their children are being exposed to on Facebook.

The possibilities are endless heading into the fourth quarter.  What’s going to happen next?  I’m not sure.  I expect that other shoe to drop sooner rather than later, though.

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The International Association of Financial Crimes Investigators (IAFCI) annual conference begins next week in Charlotte, NC.  The association, a non-profit international organization, provides an environment within which information about financial fraud, fraud investigation and fraud prevention methods can be collected, exchanged and taught for the common good of the industry.  Infoglide Software Corporation is a proud sponsor of IAFCI and will be attending this year’s event.  We invite all of our friends  - and future customers - to come visit us at Booth 105. We would love to see you there.  The conference begins on Monday, August 29th and runs through Thursday, September 2nd at the Charlotte Convention Center.

IAFCI has members across the world in every major continent, broken down by about one third law enforcement, one third banking and one third retail and service members.  The membership dovetails nicely with Infoglide’s customer base.  With a presence in major retail organizations, top global banks and mission critical government agencies, it is evident that Infoglide’s Identity Resolution Engine (IRE) is a tool that financial crimes investigators are excited about.

If you’re in the business of detecting and investigating financial crimes, AML and fraud, you know what it’s like to perform endless searches into disparate data sources looking for that golden nugget of information.  It’s worse than trying to find a needle in a haystack.  In fact, the needle itself is usually spread across  several haystacks.  Fortunately, Infoglide’s  patented IRE software helps  financial crimes investigators quickly identify ‘persons of interest’ within those haystacks of data.  Here’s how:

1. Enterprise-wide Identity Resolution: allows single-request searching into multiple databases without the need to move or clean the data.  Accounting for variations in names, addresses and other attributes, it eliminates time and effort in triaging fraud cases, and allows analysts to focus on the high-return cases.
2. Social Link Discovery: looks at non-obvious relationships between individuals across databases.  By understanding, for example, that a loan applicant shares an address with the loans officer, and also shares a telephone number with a known fraudster, a company can gain immediate insight into the risks associated with that transaction.
3. Anonymous Resolution for data Privacy: allows organizations to productively search into restricted databases without violating international data privacy laws.  The analyst can understand if a match was ‘likely’ found in the restricted data, without ever seeing or retrieving the actual results.
4. Real Time Read Flag Analysis: is the proactive implementation of the technology that looks at incoming transaction and compares them to internal and third party databases to understand possible identity matches and non obvious relationships.  If one is found, the software triggers an instant alert.

So, if you or someone you know is heading to the conference, please stop by to meet us.  It’s possible those haystacks aren’t quite as intimidating as you thought.

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By Doug Wood - Infoglide SVP of Sales

“There’s an old saying in Tennessee — I know it’s in Texas, probably in Tennessee — that says, fool me once, shame on — shame on you. Fool me — you can’t get fooled again.” - President George W. Bush

Notwithstanding the former president’s butchering of the expression, the point remains valid.  Anyone – any organization – can be fooled once.  A fraudster, or group of fraudsters, can take aim at an organization and score tens of thousands or more in ill-begotten gains.  It happens every day as a result of business’ desire to provide good customers with fast, easy access to the goods and services they want.  If they exploit that privilege – shame on them.

If, however, you don’t have systems in place that catch them trying to fool you twice – then shame on you.

Fighting fraud has always been a challenge.  As a result, technology vendors and consultants have flooded the market with tools that aim to help organizations predict fraud through behavioral analytics.  If a customer performs transactions outside of established norms, that transaction is red-flagged through this type of technology.

The complementary fraud technology is identity resolution and entity link analysis.  By focusing more on the ‘who’ of fraud, an identity resolution engine helps organizations understand who’s who… and who knows whom… within their disparate data stores.  Is the “Doug Wood” in a company’s credit application file the same as the “G. Douglas Woods” in the case management system, for example?  You might want to know that.  He fooled you once, so shame on him. 

By proactively comparing all of the attributes associated with one entity to those in a variety of internal and third party ‘negative’ lists, identity resolution and entity link analysis technology ensures that the fraudster can’t fool you again. 

Infoglide’s Identity Resolution Engine (IRE) provides companies with four strong cores of functionality:

1. Cross Database Identity Resolution allows single-request searching into multiple databases without the need to move or clean the data.  It eliminates time and effort in triaging fraud cases, and allows analysts to focus on the high-return cases. 
2. Social Link Discovery looks at non-obvious relationships between individuals across databases.  By understanding, for example, that a loan applicant shares an address with the loans officer, and also shares a telephone number with a known fraudster, a company can gain immediate insight into the risks associated with that transaction.
3.  Anonymous Resolution for Data Privacy allows organizations to productively search into restricted databases without violating international data privacy laws.  The analyst can understand if a match was ‘likely’ found in the restricted data, without ever seeing or retrieving the actual results.
4. Real Time Red Flag Analysis is the proactive, fool-me-twice implementation of the technology that looks at incoming transaction and compares them to internal and third party databases to understand possible identity matches and non obvious relationships.  If one is found, the software triggers an instant alert.

As an organization, you’re going to get burned by fraudsters from time to time.  Ensuring that you don’t get fooled again, however, requires a robust examination of the incoming data against all relevant ‘negative’ data sources.  The fraudsters are stopped in their tracks and head for an easier target.   

And there’s no shame in that.  

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By Doug Wood - Infoglide SVP of Sales

Government and commercial organizations are under increasing pressure to more effectively identify and unravel threats before they happen.  Predictive analytics tools have traditionally been deployed in hopes of isolating transactional behaviors that may point to a risk of loss.  The market is well served with these systems, yet institutional fraud seems more prevalent than ever.  Lumping in good customers with bad ones simply because they coincidentally perform similar types of transactions?  Not smart.

As a result, organizations are turning to identity resolution technology that drills down into the entities and associated relationships with a high degree of confidence.  In essence, technology that points to ‘who’ instead of simply ‘what’.  Identity resolution engines help organizations transfer from a pattern-centric to an entity-centric fraud analytic model.

So, how can analysts reconcile the massive amount of related data that exists in bits and pieces across dozens or hundreds of disparate databases?  How can they ‘connect the digital dots’ between individuals and other entities represented across so many data sources?  Key to understanding identities is the ability to perform social link discovery to determine not just ‘who’s who’… but also ‘who knows whom’.

Data warehouses and data mining tools have been used in the past to try and solve this challenge; however they require the data to be aggregated, standardized or otherwise deteriorated in order to be mined.  That’s like a CSI investigator tidying up the crime scene ahead of time, so she can more easily look for evidence.  Infoglide Software Corporation’s Identity Resolution Engine™ (IRE) looks at the evidence in all its’ gore and imperfections to present the analyst with a clear and concise view of the individuals who would commit fraud.

Gartner Group – in their 2009 Hype Cycle for Master Data Management report – suggested that “entity resolution and analysis was previously an obscure technology that has come to the forefront as a result of world events and market forces where it is used to identify identities and networks of identities who are attempting to hide their relationships to each other.”

Scott Schumacher, a government security and technology expert and former chief scientist at Initiate Systems (now IBM’s InfoSphere Identity Insight), may put it best when he writes “By identifying and managing relationships between persons of interest and other individuals or objects, (id)entity resolution delivers a more comprehensive view of people, places or things and their activity.”

By significantly mitigating the signal-to-noise challenge faced by fraud and crime analysts, organizations can be more proactive in identifying and preventing unwanted behaviors.  That’s precisely what an identity resolution engine does.

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By Doug Wood - Infoglide SVP of Sales

The word ‘triage’ tends to bring to mind the settings of a hospital emergency room.  Doctors and nurses try to examine the patient data quickly to ensure that patients with the most urgent needs are treated first.  This same concept holds true for insurance. Understanding which claims need further examination is a daily struggle that most P&C insurers deal with.

The Federal Bureau of Investigation estimates that the total cost of insurance fraud (excluding health care) exceeds $40 billion per year. That means insurance fraud costs the average U.S. family between $400 and $700 annually in the form of increased premiums.  Some call this the ‘fraud tax’.

A central component of a successful claim triage program is the ability to quickly and correctly identify a suspicious claim. These technologies trigger alerts when claims fall outside of normal patterns. The market is well served with competing technologies that provide rules-based predictive and behavioral analytics.

 With predictive analytics, fraudulent claims tend to slip through the cracks if the fraudster is careful not to trigger an alert by doing anything that would look suspicious.  Fraud is a chameleon, after all, and it thrives when allowed to blend into the background patterns.

A key new tool has emerged over the past few years which allows insurers to focus on the ‘who’ as much as the ‘what’. Identity resolution engines look at all of the attributes of the people, places and things involved in a claim and compare them to the goldmine of data already sitting behind the insurer’s firewall.  Accounting for variations in names, addresses, dates and a host of other attributes, identity resolution engines look at possible identity matches across data silos, while simultaneously discovering hidden social links between individuals.  For example, does the witness in Claim A share an address with someone currently being investigated by SIU in Claim B?  Do they have similar names or phone numbers?  Is there a fraud ring at work here?

Exposing suspicious claims based upon this robust analysis of the people involved is a sure-fire way to expose the chameleon and reduce fraud costs dramatically.

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By Doug Wood - Infoglide SVP of Sales

 “Identity Resolution Engine”

 In hindsight, we may have given an overly generic name to very complex and powerful enterprise software.   The name itself says very little about the features, functions and benefits that the technology delivers to its users, and doesn’t exactly shout “Killer App!”  Oops… Our bad.

Even the generic term “identity resolution” is boring.  “An operational business intelligence process whereby organizations can connect disparate data sources with a view to understanding possible identity matches and non-obvious relationships across data silos.”  Yawn.  It’s a bit hard to get excited about that.

What the name lacks in ingenuity, however, the software more than makes up for in unique value and core functionality.  If you’re in the business of detecting and investigating fraud, in fact, you may want to put it at the top of your ‘must have’ list.  Why?  Because this is  the only technology on the planet that can help organizations quickly and effectively identify ‘persons of interest’ within a sea of identity data.  Here’s how, as defined in the four core functions of Identity Resolution Engine.

1.       Cross Database Identity Resolution performs single sign-on searching into multiple databases simultaneously, all the while accounting for spelling errors, changes of address, cultural variations, dirty data and so on.  This core function eliminates the need for ‘serial searching’ and endless logging on and off from different databases. 

2.       Social Link Discovery finds hidden, non obvious relationships between individuals in the data.  By connecting the ‘digital dots’ between individuals or clusters of individuals, organizations can quickly identify organized fraud rings, conflicts of interest, collusion and much more.

3.       Anonymous Resolution for Data Privacy allows users to search data across departments – or across the globe – and return ONLY the data elements that are approved for return – perhaps just a probability score that a match was found.  The disallowed data elements never leave the database or country of origin, yet the search has been profoundly productive.

4.       Red Flag Analysis performs real-time analysis of identities to determine if this person is entitled to do business with your organization.  If someone has burned you in the past, you can bet they’ll try again – either by changing their attributes or working with someone else.  Red Flag Analysis stops them in their tracks.

So, what’s in a name?  Perhaps in the case of Identity Resolution Engine, not enough.  A quick look at its four core functions, however, ought to excite just about anyone whose job it is to keep fraud out of their enterprise.

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