Identity Resolution Daily

By the Infoglide Software Team

The Economist: Data, data everywhere

“By 2013 the amount of traffic flowing over the internet annually will reach 667 exabytes, according to Cisco, a maker of communications gear. And the quantity of data continues to grow faster than the ability of the network to carry it all.”

Financial Fraud Law: Fed’s 2010 Health Care Fraud Recovery: $4 Billion

“The federal government pointed to the expansion of Medicare Fraud Strike Force teams as one reason for the increased recovery. In FY 2010, the total number of cities with strike force prosecution teams was increased to seven, all of which have teams of investigators and prosecutors dedicated to fighting fraud.  The strike force teams use advanced data analysis techniques to identify high-billing levels in health care fraud hot spots so that interagency teams can target emerging or migrating schemes along with chronic fraud by criminals masquerading as health care providers or suppliers.”

Gartner: 10 Critical Myths and Realities of Master Data Management

“MDM is the latest attempt to solve the old problem of inconsistent versions of important data at the centre of an organization,” said Andrew White, research vice president at Gartner. “As with any new initiative, there is a lot of hype and confusion, and with hype and confusion comes misunderstanding. Executive sponsors of MDM and MDM program managers must avoid several common mistakes that have been known to derail MDM initiatives in the past.”

TechWorld: Cloud Computing: How big is big data? IDC’s answer

“The report notes that by 2020, much of this data will be held in cloud environments or will be “touched by cloud,” which means data that transits through a cloud service or is temporarily held in a cloud application. The report estimates that perhaps 15% of all data will be held in the cloud, and that around one-third will live in or pass through the cloud.”

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[Post from Infoglide] Financial Services Has a Growing Problem: Internal Fraud

“The Aite Group recently authored a report entitled ‘Internal Fraud: The Devil Within.’ After surveying 35 fraud and product executives at financial institutions across the U.S. and Canada, they concluded that internal fraud is a severe and growing problem that often goes undetected and almost always flies under the radar of public scrutiny.”

Bloor: There’s identity resolution and then there’s identity resolution

“The second type of identity resolution is similar but different. The classic example is in police work. Here you want to know that some particular criminal has fifteen different aliases, say. Moreover, under each of those identities he or she will have multiple contacts and you may want to do social network analysis against those contacts to see who else might have criminal tendencies.”

Chicago Sun Times: Police sensing crime before it happens

“In October, the Chicago Police Department’s new crime-forecasting unit was analyzing 911 calls for service and produced an intelligence report predicting a shooting would happen soon on a particular block on the South Side. Three minutes later, it did, police officials say. That got police Supt. Jody Weis thinking. He wondered if the department could produce intelligence reports even quicker. Next time, officers might have an hour’s notice before a shooting — instead of just a few minutes.”

KERO23:Ten People Indicted In Wide-Ranging Real Estate Scam

“The indictment alleges that, from approximately January 2004 to September 2007, the defendants perpetrated a scheme to defraud mortgage lenders by submitting fraudulent loan applications with material misrepresentations, including misrepresentations concerning the borrower’s income, assets, employment status, and intent to use the home as the borrower’s primary residence… The scheme involved more than $20 million in losses to lenders.”

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By Mike Betron, Infoglide Software Director of Marketing

The Aite Group recently authored a report entitled “Internal Fraud: The Devil Within.” After surveying 35 fraud and product executives at financial institutions across the U.S. and Canada, they concluded that internal fraud is a severe and growing problem that often goes undetected and almost always flies under the radar of public scrutiny.

On the customer relationship side of the business, many financial institutions have increased what they know about external actors by making their systems smarter, e.g. enhancing existing software with identity resolution:

“By incorporating identity resolution technology, they enhance existing historical data systems with information drawn from a wide variety of dynamic data sources (e.g., social media). Providing a real-time ‘360 view’ of an individual and his/her associations is improving daily business decisions at many leading companies.”

However, most have not yet incorporated the same technology to catch fraud. This survey suggests that insider collusion and individual fraudulent acts are on the upswing, representing a significant and growing percentage of monetary fraud losses. Furthermore, the report suggests that fraud problems are often swept under the rug:

“Most financial services firms are not keen to discuss the issue; institutions that build their brands on trust and reliability do not want it widely known that insider fraud is a problem. As a result, 35% of survey respondents reported prosecuting 10% or less of their confirmed internal fraud cases.”

Effective solutions (e.g., Infoglide’s Anti-Fraud Solution Suite) are proven and available. By not actively identifying internal fraud problems and pursuing effective solutions, financial services firms open themselves up to huge financial and public relations risk. Equally important, they enable competitors who move proactively to gain competitive advantage.

As report co-author Julie Conroy McNelley says, “Financial services firms must examine their current internal fraud prevention environment and determine how to bolster it. As competitors develop more robust defenses, fraudsters will migrate to the path of least resistance.”

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By the Infoglide Software Team

South Florida Business Journal: State Farm sues doctors, who fight back

“A contentious battle is heating up once again between State Farm Insurance Co. and a group of doctors that the insurer alleges have been involved in a multimillion-dollar insurance fraud scheme, according to a lawsuit. The suit claims the doctors submitted fraudulent claims based on ‘medically unnecessary diagnostic procedures’ used on those in car accidents.”

The National: Time for health care to move to the next level

“A Booz & Company study recently quantified some of the projected benefits from a proposed e-health initiative in Australia: by 2020, the programme could eliminate up to 10,000 deaths caused by medication mistakes, along with up to 310,000 unnecessary hospital admissions, 2 million unnecessary outpatient visits, and 7 million laboratory tests.”

[PDF] Inside the Midmarket: A 2011 Perspective

“In 2009, midsize businesses (53%) were mainly consumed with reducing costs and increasing efficiencies. The progress and momentum gained from these efforts continue to yield critical benefits and advantages for midsize businesses. Because of this momentum, they are now in a position to turn their attention to more forward-looking aspects of their business. This is demonstrated by the significant increase in focus on customers (+20 pts), innovation (+7 pts), and revenue growth (+5 pts).”

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[Post from Infoglide] Entity Identity Management

“What is entity identity management? It simply means that an ER system can store and maintain a record of identity information that persists over time.  Entity identity management is essential for an ER engine to operate in identity resolution or identity capture mode and for it to maintain persistent entity identifiers.”

InformationWeek: 4 Companies Getting Real Results From Cloud Computing

“Why are they moving to the cloud? Rarely because it’s considered cheaper. In some cases, the cloud represents a faster, more flexible way to get a new system up and running. Oftentimes, it’s the ease of integration afforded by the cloud servers, using standard Web service practices, that lets a company launch a new mobile application faster or run a business process that cuts across many partners more efficiently.”

MindHealthBiz: Consumer ID

“A little over a year ago, Rand Corporation said that the Unique Patient Identifier would cost $11 billion, and pay off nationwide in reducing these sorts of medical errors, and in simplifying the nationwide effectiveness of the Electronic Health Record (EHR), which in turn can introduce a high level of efficiency, and a way to enforce patient privacy.”

pi newswire: US Sues NYC for Medicaid Fraud

“Enrollment in Personal Care Service requires approval from a qualified health care professional. This approval is missing in the cases of a ’substantial percentage’ of the 17,500 individuals who have received 24-hour care since 2000, claims the lawsuit. The lawsuit lists several examples of patients allegedly not properly assigned to the Personal Care Service. A 65-year-old woman was deemed to only need limited care, being of sound mind and body. Instead, she was provided with 24-hour care on the federal government’s bill.”

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By John Talburt, PhD, CDMP, Director, UALR Laboratory for Advanced Research in Entity Resolution and Information Quality (ERIQ)

First, let me wish everyone a Happy and Prosperous New Year.  Also, since my last post, my book Entity Resolution and Information Quality has been published and is now available from Morgan Kaufmann Publishing (http://mkp.com/news/entity-resolution-and-information-quality).

What is entity identity management? It simply means that an ER system can store and maintain a record of identity information that persists over time.  Entity identity management is essential for an ER engine to operate in identity resolution or identity capture mode and for it to maintain persistent entity identifiers.

As you may recall from previous discussions, an identity resolution ER system starts with a set of known (asserted) identities and attempts to determine if a given entity reference refers to one of these known entities.  On the other hand, an identity capture ER system starts with a blank slate and tries to construct an identity based on the (equivalent) references it processes.

Two important concepts here bear further discussion.  One is the structure for representing the identity of an entity, and the second and somewhat more philosophical question is, what constitutes entity identity.

There are two commonly used approaches to representing identity in ER systems – one is an attribute-level structure sometimes called a “merge identity” and the other is a reference-level structure sometimes called a “cluster identity.”  The difference between a merge identity and a cluster identity can be illustrated by a simple example.

Suppose we have a system where entity references have three attributes A, B, and C, and that we are given two specific entity references R1=(a1, b1, c1) and R2=(a2, b2, c1), where a1 and a2 are values for attribute A, b1 and b2 values for attribute B, and c1 a value for attribute C.  Finally assume that references R1 and R2 are determined to be equivalent references (i.e. references to the same real-world entity).  In the merge identity approach, the entity identity EM referenced by R1 and R2 would be represented as

EM=[A:{a1, a2}, B:{b1, b2}, C:{c1}]

Meaning that for identity EM the A attribute can take on either the value a1 or a2, the B attributes can take on the value b1 or b2, and the C attribute the value c1.  In a merge identity the binding between the values a1 and b1 that was expressed by their co-occurrence in the reference R1 is lost.  Similarly the binding between a2 and b2 expressed by R2 is no longer present in EM.

In a cluster identity structure, the original reference binding between attribute values is preserved.  In the cluster identity approach, the entity identity EC referenced by R1 and R2 would be represented as

EC=[(A:a1, B:b2, C:c1), (A:a2, B:b2, C:c1)]

Thus, for identity EC the attributes A, B, and C can only take on the permutations given by the original references R1 and R2. There are advantages and disadvantages to both approaches, but most significantly they can lead to different resolutions for the same set of references.

To illustrate, let’s continue with the preceding example by supposing that the systems using the merge identity and the cluster identity both use the same two resolution rules.  Rule 1 is that the two references are considered equivalent if they agree (exact match) on Attribute C.  Rule 2 is that they are equivalent if they agree (exact match) on both Attributes A and B.

Now suppose that each system processes a third entity reference R3=(a1, b2, c2).  Using the two rules just discussed, the merge identity system would resolve R3 as equivalent to the identity EM represented by references R1 and R2.  By Rule 1, R3 agrees with EM on attribute A and also attribute B.  On the other hand, R3 would not resolve to the identity EC in the cluster identity system.  R3 does not satisfy either Rule 1 or Rule 2 with respect to either of the references R1 and R2 that comprise the cluster identity EC.

Merge identities and cluster identities both represent valid, but different, approaches to identity management.  To some extent they also represent two different ways of thinking about entity identity.  I plan to discuss the concept of the entity identity further in the next post.

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[Post from Infoglide] You Can’t Handle the Truth

“We have a new Congress and a new House majority leader as of this week’s swearing in ceremony. The current House majority party (R) plans to pass a bill to repeal the ‘Obamacare’ bill passed during the last session by the former House majority party (D).  Both parties make ‘fact based’ arguments about why killing or keeping the bill will reduce the deficit, yet both can’t be right. This isn’t a political blog, and I’m not going to take a side on this issue. What struck me is how often we use ‘facts’ to bolster our argument, with ‘facts’ defined as any real data that can be massaged or misinterpreted to suggest that our desired outcome appears to be the best one.”

The Washington Post: The Navigator: Does Secure Flight program mean more money for the airlines?

“When she arrived at the screening area, her husband’s incorrect name had already been checked against a list of potential security threats and had passed. Once passengers receive their boarding passes, the Secure Flight process is already complete, according to the TSA.”

LinkedIn: Data Quality of Gender / Sex Codes and the Impacts on Identity Data Matching

“Identity matching requires matching practitioners to decide which collection of fields best allows the correct matching of one record with another. The choice can be made from fields such as name, date of birth, address details, sex / gender, and even unique identifier values (when they exist). The use of sex / gender in that process might be seen in a slightly different light.”

nj.com: Bill would allow people to buy New Jersey Lottery tickets electronically

“Under the bill, the commission would establish procedures for the payment of winning tickets holders, which may include crediting amounts won to a player’s account or direct deposit into a player’s account at a financial institution… The commission would also be directed to ensure that the program includes security measures to protect against fraud, prevent wagering by underage persons and protect the personal and financial information of players.”

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By Mike Shultz, Infoglide Software CEO

We have a new Congress and a new House majority leader as of this week’s swearing in ceremony. The current House majority party (R) plans to pass a bill to repeal the “Obamacare” bill passed during the last session by the former House majority party (D).  Both parties make “fact based” arguments about why killing or keeping the bill will reduce the deficit, yet both can’t be right.

This isn’t a political blog, and I’m not going to take a side on this issue. What struck me is how often we use “facts” to bolster our argument, with “facts” defined as any real data that can be massaged or misinterpreted to suggest that our desired outcome appears to be the best one. Actual data is often plentiful but our preference for one alternative keeps us from embracing and promoting reality.

So mishandling the truth when you have all the facts you need is a conscious action. What happens when you think you have the data needed to make a rational decision but you aren’t conscious of important information that could totally change your perception? For example, we may have access to what look like sufficient pieces of information to reach a rational business decision, such as a driver’s license with a photo ID or a computed credit score based on the person’s history of business transactions.

However, what’s often missing from the decision process is knowledge about relationships between people. Understanding these relationships – who’s who, who knows who, and other non-obvious connections – can increase beneficial decisions in a colossal way, yet awareness of these relationships is rarely incorporated into the process.

Since entity resolution can increase the accuracy of business processes by an order of magnitude, our New Year’s resolution here at Infoglide is to introduce as many people as possible to its benefits.

Happy New Year!

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By the Infoglide Software Team

ebiz: Relevance of Enterprise Architecture to Cloud Computing

“Strategic decisions about cloud computing should both draw upon and inform the EA. An organization must have a mature and well formed understanding of its architecture components (e.g., business processes, services, applications and data) to make meaningful decisions related to cloud computing, such as whether a move to the cloud is advantageous, what services most lend themselves to a cloud deployment, and what cloud deployment model (e.g., private, public) makes the most sense. There are three key roles for EA in facilitating cloud computing strategy and planning…”

WRAL.com: State roots out $53M in Medicaid fraud

“‘Medicaid cheaters rob taxpayers, hurt needy patients and push medical costs higher for all of us,’ Cooper said in a statement. ‘We’re stopping the waste and abuse and making violators pay.’ During the federal fiscal year that ended Sept. 30, the Medicaid Investigations Unit of the state Attorney General’s Office won 22 criminal convictions and negotiated 18 civil settlements worth $53.5 million.”

AvStop.com: All Airline Passengers Now Screened Against Government Watchlists

“Under Secure Flight, the Transportation Security Administration (TSA) prescreens passenger name, date of birth and gender against terrorist watchlists before passengers receive their boarding passes. In addition to facilitating secure travel for all passengers, the program helps prevent the misidentification of passengers who have names similar to individuals on government watchlists. Prior to Secure Flight, airlines held responsibility for checking passengers against watchlists.”

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Looking back over the past year, we’re especially grateful for relationships we’ve built and grown with customers and partners. Despite a less than stellar economy, 2010 provided another good year of growth for Infoglide Software.

2010 also proved to be a year of accelerated visibility for identity resolution and entity analytics in general. Industry consolidation moves (e.g., IBM’s March acquisition of Initiate Systems) demonstrate the critical importance of entity resolution in the new era of Big Data that has been developing.

For the readers of IdentityResolutionDaily, please accept our thanks for your continuing interest and participation in the exciting growth of this market. 2010 promises to be a year of continued change and challenge, and we look forward to the opportunities it offers.

We’ll start with new posts again in January.

Happy Holidays, and Best Wishes for a Wonderful 2011!

Mike Shultz
CEO, Infoglide Software

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