Identity Resolution Daily

By the Infoglide Team

cnet news: What you need to know about e-health records

“Supporters say electronic medical records will boost the quality of medical care, reduce duplication of services, and limit errors, all of which could save money and lives. The National Academy of Sciences’ Institute of Medicine estimates that between 44,000 and 98,000 people in the United States die each year because of errors such as being prescribed medicine to which they are allergic.”

tricityherald.com: Travel restrictions to get tighter June 1

” Beginning June 1, travelers will need either a U.S. passport, a state-issued enhanced driver’s license, a U.S. passport card or a trusted traveler card to enter the country through land or seaports. Passports were made mandatory for air travel in 2007.”

Las Vegas Sun: Fusion center’s attention on prevention

“The trio appeared to be doing the kind of photographic surveillance terrorists might do before they strike a target, the officers concluded. So they contacted the Southern Nevada Counter-Terrorism Center. The center is run by Metro Police and houses investigators and analysts from local, state and federal law enforcement agencies in Southern Nevada.”

Destination CRM Blog: Tom Siebel Sends His Regrets

“Our customer data is now more siloed than it ever was, it doesn’t match, and the owners of the respective systems that process it don’t talk to each other much. The single version of the truth has eluded us. We’re still trying to sell customers products they already have.”

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If you’re not familiar with the International Association of Industrial Accident Boards & Commissions (IAIABC), it’s a very active non-profit organization of government agencies that administer workers’ compensation programs in the U.S., Canada, and other countries. In addition to sponsoring a large number of industry events including conferences and training seminars, they publish an excellent journal twice yearly that provides educational articles about education, research, and management of workers’ compensation issues.

The April issue of IAIABC Journal includes an article authored by Infoglide’s Charles Clendenen. “Introducing Identity Resolution: A New Approach to Workers’ Compensation Fraud” discusses three types of workers’ compensation fraud and how identity resolution (aka entity analytics or entity resolution) is being applied to make the process of finding potential employer fraud easier and more cost-effective.

While medical fraud and employee fraud are significant problems, “employer premium fraud, while less publicized, can involve millions of dollars in unpaid or underpaid premiums and can cause much more damage to the insuring agency.”

Employer premium fraud can take several forms. In order to avoid paying premiums, a company’s owners may illegally classify permanent employees as contractors. Alternately, they may operate for some time without paying their premiums, and then when the insurer is about to take action, they simply shut down the company on paper and reconstitute it under another name. Companies also use this “going out of business” ploy in cases where their experience (or modification) rating has gone up due to multiple injuries, thereby resulting in higher premiums. By reopening as another company, they can effectively reset their experience rating. 

Clendenen goes on to introduce identity resolution technology and discuss its origins, then talks about how it can be applied to solve workers’ comp employer fraud.

While identity resolution technologies can be applied to employee and provider fraud, they are particularly effective at uncovering employer premium fraud. Finding companies who are not registered for workers’ compensation involves comparing databases where companies are advertising themselves as open for business to lists of businesses registered with state workers’ compensation programs. The results can highlight companies who have not registered or are not paying premiums, companies who have changed their name often, and companies involved in hidden contractor/ subcontractor relationships.

The rest of the article talks in more detail about how identity resolution can be applied and the potential return on investment (ROI) agencies can expect.

Click here to read the full article, and to learn more about IAIABC, check out their web site.

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By Dan Power, President and Founder, Hub Solution Designs

There definitely seems to be a trend lately with small companies in the master data management (MDM) and data quality space being purchased (as in the asset acquisition of Exeros by IBM) or partnering with larger firms (such as Silver Creek Systems’ OEM relationship with Oracle).

I think this is a good thing. Using the classic “build, buy or ally” strategy, it isn’t surprising that sometimes companies will conclude that it’s faster and/or cheaper to buy a technology, or partner with another company that has that technology, rather than build it themselves internally.

A lot of companies do tend to suffer from the “not invented here” syndrome, where anything not developed inside their four walls tends to be regarded with disdain. But that tendency leads to a much slower pace of innovation. In very competitive industries like enterprise software, getting there faster is a very definite advantage.

Since I’ve been working with the identity resolution experts at Infoglide, I’ve become much more aware of the role identity resolution technology plays in our daily lives. Every time you get on an airplane, file an insurance claim, apply for a job / mortgage / credit card, or even shop in a retail store or on a web site, your identity is probably being evaluated by an Identity Resolution Engine.

A lot of people in the MDM space refer to this as “matching”, but there’s considerably more to Identity Resolution than the sophisticated pattern matching that most MDM hub platforms use today. The more robust form – Identity Resolution – is mostly used currently for sophisticated applications like terrorist screening and anti-money laundering, where big consequences or big dollar amounts are at stake.

But that technology is gradually filtering down to more routine commercial applications like master data management for customers. The large MDM vendors like Oracle, IBM and SAP – and the smaller vendors like Siperian, Initiate Systems and D&B/Purisma – will follow the “build, buy or ally” pattern, with some opting to create their own more sophisticated Entity Resolution capabilities, some buying smaller firms who already have those advanced products, or perhaps partnering as a middle ground between building and buying.

Either way, this trend is good both for specialized companies like Infoglide and for the general public. We’ll all be a little safer getting on a plane, a little less likely to suffer from identity theft or confusion, and perhaps save a little money through reduced incidence of various types of fraud.

Full-fledged Identity Resolution is a capability that most MDM hubs should plan on adding in the next revision cycle or two, as MDM customers become more discriminating and more demanding of their hub’s ability to identify individuals and businesses from an ever-growing stream of data.

Dan Power is president of Hub Solution Designs, a consulting firm specializing in master data management and data governance. He writes a popular blog and a column for Information Management magazine, speaks frequently at technology conferences, and regularly advises clients on developing & implementing high impact MDM and data governance strategies.

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By Robert Barker, Infoglide Senior VP & Chief Marketing Officer

Clowns to the left of me, Jokers to the right,
Here I am, stuck in the middle with you.

-Jerry Rafferty and Joe Egan, Stealers Wheel

One reason Identity Resolution Daily began two years ago was to create a venue to address privacy/security controversies. Because we supply and support core technology used in DHS’s Secure Flight program that performs airline passenger watch list matching, we established a vehicle to discuss how powerful technology can help the country be more secure while simultaneously protecting privacy.

The discussion rages on: how can we balance society’s competing needs for privacy and security? Fusion centers were created to increase the collaboration and effectiveness of law enforcement agencies in combating crime and terrorism, but now we see privacy groups and legislatures (among others) pitted against each other, and guess who’s caught in the middle? Those enforcing the law.

From wikipedia, “a Fusion Center is a terrorism prevention and response center” that gathers “information not only from government sources, but also from their partners in the private sector. They are designed to promote information sharing at the federal level between agencies such as the CIA, FBI and Department of Justice) and at the state and local level.”

A concept developed as a response to the events of 9/11, the objective of fusion centers is to coordinate law enforcement efforts to prevent future terrorist events. While 58 state and local fusion centers have been implemented, standardization is lacking when it comes to how they operate and what they focus on.

Of course, any effort that deals with personal information produces the potential for abuse. Recent news stories have raised cries from both the left and right ends of the political spectrum, resulting in some strange partnerships.

So where do we fall on this issue? You might say we’re stuck in the middle. Like law enforcement agencies, we’re trying to do our job as best we can. In the case of the agencies, it’s catching the bad guys before they do damage, yet without infringing on citizens’ privacy. For us, that means supplying software that allows them to do just that.

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By Robert Barker, Infoglide Senior Vice President & Chief Marketing Officer

In a February post blogger Steve Sarsfield talked about government mandates that direct financial institutions to avoid doing business with known “bad guys”:

The mandates have to do with the lists of terrorists offered by the European Union, Australia, Canada and the United States. For example, in the U.S., the US Treasury Department publishes a list of terrorists and narcotics traffickers. These individuals and companies are called “Specially Designated Nationals” or “SDNs.” Their assets are blocked and companies in the U.S. are discouraged from dealing with them by the Office of Foreign Asset Control (OFAC)… If your company fails to identify and block a bad guy… there could be real world consequences such as an enforcement action against your bank or company, and negative publicity.

He goes on to describe the role that data quality software plays in addressing the problem. While I agree with Steve that improving data quality is an important component of some solutions, I’d emphasize that it’s critical to know when and where to improve it. Too much “quality” can actually hurt a solution’s effectiveness.

Professor John Talburt (ERIQ) illustrated this notion in a recent guest post. Making the case for using entity resolution to find hidden relationships, he first showed how the absence of sufficient attributes can cause false positives. He then went on to say:

Even given that the set of identity attributes is large enough to avoid a false positive, the larger problem with matching as a surrogate for entity resolution is that it produces false negatives.  For example, “Mary Doe, 234 Elm St” and “Mary Smith, 456 Pine St” do not match, but does that mean they are not references to the same entity?  It could very well be the case that Mary Doe married John Smith and moved to his house at 456 Pine St.

So in looking for bad actors, suppose the address of one of the two Mary Does above had been resolved to the “correct” address by applying data quality software before using entity resolution to search for hidden relationships. We might have never discovered that Mary Doe married the nefarious John Smith who is on the OFAC list!

If the goal of the solution is merely compliance with a minimum of false positives, data quality can help achieve these goals. But if the goal of the solution is to find bad guys by discovering non-obvious relationships, false negatives are a more important consideration. While false positives are a costly annoyance that require extra resources to resolve, false negatives can mean missing bad guys altogether, and that hurts much more than the bottom line. It can mean not complying with the mandates.

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January 30th, 2009

[Post from Infoglide] Will Workers Comp Employer Fraud Keep Rising?

“In our collections of links about identity resolution, we often include stories about employees who defraud workers compensation agencies. Most of the time it concerns someone who’s claimed a disability in order to get payments and is then working another job that proves they are healthy.  Another twist is covering up the fact that a relative drawing workers comp benefits has died in order to continue receiving payments.”

Insurance & Financial Advisor: Pennsylvania man among seven charged in multi-million dollar workers’ comp fraud

“In a pair of recent indictments, the defendants are accused of lying on insurance applications and failing to remit insurance premiums to the insurance companies, instead keeping the money for themselves, according to theNew Jersey Attorney General’s Office. The defendants are also accused of laundering money so the scheme would go undetected. As a result, many people were allegedly left without workers compensation insurance.”

Business Intelligence News: Gartner’s Magic Quadrant for Business Intelligence Platforms 2009

“Recently, Gartner published its report called Magic Quadrant for Business Intelligence Platforms 2009. This report is Gartner’s opinion about the market of BI and their main vendors.”

Network World: MySpace faces fresh controversy over sex offender issue

“Pallorium maintains a database of more than 600,000 sex offenders culled from state registries around the country. Rambam said he took a random sample of 40,000 names from that database and then searched more than 2 million MySpace member pages for matches. An initial search using first and last names, approximate age and city and state of residence as keywords yielded over 12,400 matches, Rambam claimed.”

Daily Insurer: New Yorker Nabbed in Workers’ Comp Scheme

“According to Solomon Jones, an investigator with the Insurance Department’s Frauds Bureau, Cossio submitted signed statements to the Insurance Fund falsely claiming he was unable to work after injuring his back while employed as a laborer. Jones said investigators found that Cossio was working as a porter and maintenance attendant while collecting the benefits.”

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By Robert Barker, Infoglide Senior Vice President & Chief Marketing Officer

In our collections of links about identity resolution, we often include stories about employees who defraud workers compensation agencies. Most of the time it concerns someone who’s claimed a disability in order to get payments and is then working another job that proves they are healthy.  Another twist is covering up the fact that a relative drawing workers comp benefits has died in order to continue receiving payments.

The Ohio Bureau of Workers’ Compensation estimates that they pay as much as $320 million annually in fraudulent claims to both employees and employers. Their definition of fraud is “as an intentional act or series of acts resulting in payments or benefits to a person or entity that is not entitled to receive those payments or benefits. Fraud is committed when a person
•    knowingly receives benefits which he or she is not entitled to receive by law;
•    makes false or misleading statements for the purpose of receiving money or services; or
•    enters into a conspiracy to defraud the Ohio State Insurance Fund or self-insuring employer under the Workers’ Compensation Act.”

While the employee fraud problem is significant, blogger Leonard Jernigan rightly points out that the third type of fraud in Ohio’s definition, i.e. fraud by employers, is an even bigger problem. “When thousands of employers across the country intentionally fail to pay required workers’ compensation premiums or misrepresent the job classification of employees who are covered, the fraud perpetrated on the system vastly exceeds the dollar amount of employee fraud.” Despite this fact, attention (and most of the news coverage) seems to be focused on employee fraud. Perhaps it’s the “gotcha” aspect of many of the nighttime news programs that makes employee fraud more appealing. Employer fraud isn’t as sensational but, based, on the financial impact, it should be getting more attention.

Jernigan lists no fewer than 14 different ways that employers defraud the system and thereby increase the burden on taxpayers for underwriting the healthcare costs of injured workers. Employer fraud takes many forms, but in all cases the object is to eliminate or reduce payments into the workers compensation system, and that increases the tax burden on all of us. The current challenging economic situation will likely increase the temptation for businesses to workers compensation payments. The losses incurred through employer fraud should increase detection and prosecution efforts.

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By the Infoglide Team

Long Beach Press-Telegram: 3 more truck firms named in port probe

“In the latest cases, the companies were able to avoid paying overtime, payroll taxes, health insurance and workers’ compensation by labeling their drivers ‘independent contractors’ — a label applied to some 90 percent of truckers in the ports of Long Beach and Los Angeles.”

All Things Data: Master Data Management and the Mid-Market Need

“Basically, the MDM Summit in New York confirmed that the process to implement a Master Data Management initiative is generally the same regardless of whether the organization is a Mid-Market company or a larger enterprise.”

SmartBrief: Homeland Security releases more details on Secure Flight program

“The Department of Homeland Security estimates 99% of passengers will breeze through security next year when federal officials take over the job of screening names provided by the airlines.”

Confessions of a database geek: Updates to the Information Quality Aggregator

“It’s great to see more activity in the data quality arena. Dylan Jones started the Data Quality Pro site, and dropped me a note with some additional blogs to consider. A couple look pretty good!”

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[Post from Infoglide] Start Early on Data Quality

“Identity resolution plays a vital role in data quality applications. Applying identity resolution on the front-end can ensure that error-filled and fraudulent identity information is detected and kept from entering production systems.”

Nashua Telegraph: Owners take on workers at issue

“In addition, the business avoided more than $368,000 in worker’s compensation insurance premiums by under-reporting the number of workers they had hired, prosecutors claim.”

Kiplinger Business Resource Center: Government to Take over Screening from Airlines

“Under a program dubbed Secure Flight, the Transportation Security Administration (TSA) will assume responsibility for checking passengers against a watch list of known and suspected terrorists. Currently, that job is performed by the airlines, and each one has its own process.”

CSO Security Leadership: Opposing Forces in a Down Market

“In a tightening economy, history has proven that the risks faced by businesses increase significantly. When times begin to get tough for individuals, many will turn to crime to abate their diminishing financial situations.”

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By the Infoglide Team

info4security: The Cybercrime Arms Race

“Criminal activity has always mirrored legitimate business. The image of a Mafia accountant may be the first to spring to mind. However, it’s worth noting that cybercrime is not currently organised into one or more worldwide Mafia-like organizations with a Dr No figure at the helm. Rather, it’s an interdependent world based on groups who have complementary functionality.”

Portfolio.com: Insider Trading Suspects Settle Up

“In what the S.E.C. called the ‘Wall Street Serial Insider Trading Ring,’ 14 defendants, in two different schemes, traded repeatedly on non-public information in exchange for cash kickbacks, according to the complaint. Overall, they allegedly made at least $15 million in illegal profits.”

SecurityFocus: Two-thirds of firms hit by cybercrime

“More than 7,800 companies responded to the survey (pdf), which classified cybercrime into cyber attacks, cyber theft, and other incidents.”

Information Week: Congress Extends Cybercrime Laws

“The U.S. House of Representatives approved the bill — H.R. 5938 — Monday. The amendment — part of Senate bill S. 2168 — expands the ability of the federal government to prosecute identity theft crimes and allows victims to obtain restitution for the time and money they spend trying to restore their credit. The legislation, which must be signed by President George W. Bush, allows a fine and up to five years imprisonment for spyware.”

NRF LPInformation: Update on ORC Hearing, September 22 (Monday) at 4pm

“The House Judiciary Committee’s Subcommittee on Crime, Terrorism and Homeland Security is scheduled to address H.R. 6713, the ‘E-fencing Enforcement Act of 2008′, H.R. 6491, the ‘Organized Retail Crime Act of 2008′ and S. 3434, the ‘Combating Organized Retail Crime Act of 2008′.”

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