Identity Resolution Daily

With each new revelation of lottery fraud, the urgency of preventing further occurrences intensifies. It’s now a top line issue for lottery commissions because it threatens to significantly decrease revenue. The danger is that the number of consumers feeling at risk about being paid on a winning ticket could reach a tipping point. An affected lottery could see a substantial decrease in revenue almost overnight, and it’s difficult to predict when that tipping point will be reached.

Detecting and preventing lottery fraud requires a specialized combination of experience and technology. In particular, when lottery fraud is committed by retailers, the people defrauding the system are aware of just how the system works, so the solution has to be able to outsmart people who know all the tricks.

The same can be said for Organized Retail Crime fraud.  These types of crimes cost the retail industry over $40 billion a year. In helping retail customers attack these problems, our identity resolution software churns through enterprise identity data (e.g., employees, merchandise returns, customers, shoplifters, bad check data) to resolve identities and detect hidden relationships.

As with retail, the data to detect lottery fraud is readily available, but solving the crime requires knowledge about handling multiple, disparate data sources and how to find hidden connections using identity resolution. In fact, the parameters of lottery fraud are strikingly similar to retail fraud. Someone who understands how the system works fraudulently fences merchandise (or a winning lottery ticket).  Retailers can check potential fraudsters against a list of employees and known shoplifters, while government-run lotteries can check winners against lists of lottery retailers and – for example - delinquent taxpayers.

Forward-thinking lotteries are quickly moving to exploit solutions based on identity resolution to solve the problem. The risk of declining revenues is just too high to do nothing.

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By the Infoglide Team

Have the courage to say no. Have the courage to face the truth. Do the right thing because it is right. These are the magic keys to living your life with integrity.                                                  – W. Clement Stone

We recently shared a link to an article describing how trucking companies in California illegally mislabeled their drivers as “independent contractors” in order to keep from paying workers’ compensation insurance. The law clearly defines the drivers as “employees” since the companies own the trucks and define everything the drivers do.

Because identity resolution software is often used to detect fraudulent behavior, we continually hear of instances like this one where people try to cut corners or take unfair advantage or flat out cheat other people and companies in ways that often involve obscuring identity information. People try to game software systems and cheat in areas like workers’ compensation, online commerce, lotteries, retail, airlines, insurance, social networking, and others. (You can read more on our web site and in previous blog posts here.)

Almost all of us know the right way and the wrong way to do things. Sadly, we sometimes choose to ignore that inner voice when it benefits us, even though it may harm someone else. OK, so we can’t fix the world with a blog post, but it’s hard not to speculate what the world might be like if we all tried to do the right thing all the time.

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By the Infoglide Team

CIOZone: What To Do About Bad Data

“The amount of data is doubling every 12 to 18 months—but much of it is inaccurate, incomplete or otherwise flawed. And bad data costs organizations between 10 to 20 percent of revenue. But there are steps CIOs can take to fix the data problem.”

ZDNet: Data Quality - Upstream or Downstream?

“How come most companies start worrying about the quality of your data only when it’s already dirty and in use? How come it doesn’t occur to them that the quality of data needs to be thought through before it’s actually captured? Even at the early stages of data capturing, data quality already plays an important role in the future of the company.”

Star-Ledger: eBay makes bid to oppose limits on online sales

“The big-box retail chains say they are concerned eBay and similar online sales sites offer professional shoplifters a largely anonymous venue for e-fencing their stolen goods. But eBay says brick-and-mortar retailers are using the argument as a ploy to try and stifle competition from online sellers. Coming as it does at the threshold of the holiday shopping season, there is a lot at stake for both sides in this Goliath vs. Goliath battle for the hearts and wallets of American consumers.”

CNW Group: Protecting lottery customers

“Over the past 12 months, OLG has taken significant action toward protecting lottery customers from theft and fraud.”

Your Industry News: Stopgap Bill Includes $101B For DOD Procurement

“The $630 billion-plus stopgap spending bill signed into law by President Bush includes $487.7 billion to fund the Defense Department and more than $40 billion to fund the Homeland Security Department through the end of fiscal 2009.”

Vancouver Sun: The war on retail crime

“Technology is becoming sophisticated enough to recognize when conventional patterns are broken, such as a door that is only entered by employees coming from a certain direction.”

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By the Infoglide Team

Lottery Scam: Lottery Scam Watch - Keep Track of Your Tickets

“The ticket was bought in May. When the ticket holder came to the store for verification, the clerk allegedly told him he was mistaken and kept the ticket. A police report contends that Melissa Trahan, 27, sent the winning slip to her mother in Mississippi. That woman, Gwen Landry, drove to the state capital, Baton Rouge, and cashed it in for the $800,000.”

Hub Solution Designs: Customer Data Quality

“Sometimes, attempts are made to programmatically improve data quality within a customer record, but because of tight deadlines, data quality across the file is usually not given serious attention.”

CT.gov: Waterford Town Employee Charged with Workers’ Compensation Fraud

“The warrant alleges that Mr. Hall ‘intentionally misrepresented his claimed injury and intentionally failed to disclose his employment and wage earnings while collecting disability benefits.’”

Homeland Security Watch: Senate Introduces its First DHS Authorization Bill

“The Senate bill elevates the assistant secretary for policy to the position of Under Secretary for Policy, to ensure policy coordination across the Department, it strengthens the authorities of the Office of International Affairs at DHS, and it authorizes the National Cyber Security Center, along with a private sector board to advise the Secretary on cyber security policy.”

Workers Compensation: California Fines Auto Body Shops Without Workers’ Comp Insurance

“Failure to carry workers’ compensation insurance is fraud, plain and simple. This is a form of workers’ compensation fraud – not having the appropriate coverage – is more common than you might think.”

Central Coast News: Santa Cruz police crack large commercial burglary case at Safeway

“Safeway loss prevention officers notified Santa Cruz police on Sept. 9 that the company’s store on Morrissey Boulevard had lost a significant amount of merchandise to theft and store managers suspected that an employee, Emanuel Anthony Ruiz, 30, was stealing merchandise. He allegedly took cosmetics, shoes, clothing and over-the-counter pharmaceutical items, including medications, from the store, police reported. Ruiz, with the help of the three others arrested, was then selling the items online, police said.”

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

At the recent International Conference on Cybercrime Forensics Education and Training in Canterbury UK, international experts discussed the challenges involved in keeping up with increasingly sophisticated criminals who target children on the internet. They covered a wide array of subjects that illustrated the complex ways that computer systems are exposed, including topics like mobile phone forensic investigation, the social effects of Spam, digital intrusion forensics, implications and methodology of facial ID training, and virtual reality police training.

Pedophiles use multiple forms of internet communication to share information, including photographs. A recent infamous example in the UK is Philip Anthony Thompson. A British police unit discovered that his home computer was hosting a quarter of a million child porn images, including 3000 depicting sadistic abuse, and that Thompson served as an administrator of a forum that enabled and encouraged sharing of images and knowledge. 

Is the fact that Thompson was caught a sign that law enforcement has the problem under control? Not exactly. Denis Edgar-Nevill, chairman of the cybercrime forensics conference, pointed out that “people should not believe that cybercrime is being dealt with well or that it is something law enforcement agencies are on top of.” He was not being critical of law enforcement, and in fact he commended them for work in certain areas. It’s just that the scale of the problem is so huge, and with the growing number of avenues for people to communicate, it’s incredibly difficult for enforcement agencies to keep up. Their resources are divided across a number of cybercrimes, and, for better or worse, financial crimes are often considered more serious.

Given the finite human resources of police agencies, can technology fill the gap? Sexual predation depends on the use of fraudulent identities. Identity resolution technology has been used to fight many other types of fraud. It can find stolen goods being fenced on eBay by ORC groups. Stock exchanges find hidden relationships that lead to identification of insider trades. Retailers use it to detect and prevent deceptive returns of stolen merchandise by deceitful employees. Lotteries can detect false claims with winning tickets. Workers’ compensation agencies leverage identity resolution to identify fraudulent claims. And terrorists are prevented from boarding airplanes.

With proper cooperation between law enforcement agencies and information technology vendors, surely identity resolution technology can enable the development of automated systems that will shine a light on predators and greatly diminish their ability to operate under the radar of police groups.

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NOTE: We apologize for our recent technical problems. They’ve been fixed, and we don’t anticipate any further disruptions.

Hub Solution Designs: August Column in DM Review

“MDM without a robust approach to data quality can be dangerous. We’ve all heard the IT cliché ‘garbage in, garbage out.’ But that is very true of building an MDM hub solution. You’re literally at the mercy of the worst data entry person in the company as you gather information from any number of source systems to feed into your new hub.”

MarketWatch: Bra thief busted

“A New York man from the regal borough of Queens was charged with selling $80,000 worth of stolen Victoria’s Secret brassieres on eBay. Over 2,000 bras ranging in value from $40 to $80 were allegedly sold by George Tutaya on the auction site. . . . The eBay aliases have since been removed but the New York Post reports that buyers were quite pleased with Tutaya’s service, which received a 100 percent approval rating.”

Confessions of a database geek: Data Quality Conference: Are you going?

“That said, if you have a strong interest in data quality, I encourage you to take a look at the conference program. Larry English and David Loshin are two of the featured speakers. (I still remember a presentation from Larry at a TDWI conference 10 years ago — he’s great.) Looking further, I see presentations ranging from metrics to politics to dictionaries.”

NOTE: We are planning on being at the conference. Let us know if you’d like to meet with us there.

The Bunker Blog: Organized Retail Theft - “Boosting For Billions” Airs On MSNBC

“On September 7th, MSNBC aired a 1-hour documentary entitled “Boosting For Billions” which took a serious look at the growing problem of Organized Retail Theft.  The program featured interviews with Jerry Biggs, ORC Division Coordinator at Walgreens, and Tony Heredia, Director, Assets Protection at Target Corporation.”

Andy on Enterprise Software: A speedy investment

“It is good to see venture firms dipping their toes back in the water of innovative enterprise software companies. A couple of years ago I came across what I thought was an interesting data quality company called Zoomix. I introduced them to a prestigious venture firm, who were entirely uninterested, at the time chasing after ever more trendy social networking websites (the company was in fact bought by Microsoft a few months ago, which would have netted a pretty decent return for the investors).”

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By the Infoglide Team

Fraud, Phishing and Financial Misdeeds: Lottery Bandit Nabbed in California

“In May, alert SaveMart grocery store employees noted an individual attempting to cash in a on a winning lottery ticket reported stolen in the burglaries. . . . It’s pretty obvious that the alert employees at SaveMart were tipped off electronically that the ticket(s) being presented were ‘hot.’ . . . This isn’t the first time in recent history, the California Lottery Police have made headlines. In May, it was announced that they were using undercover agents to catch dishonest retailers, who were cheating winners out of their prizes. Winning tickets of $500 to $25,000 were presented to retailers and several of them were caught pretending the prize was smaller and keeping the proceeds for themselves. Several arrests were made throughout California as a result of the sting.”

Informatica Perspectives: Communicating the Value of Data Quality

“Many of our customers express frustration that even though it is quite obvious how their business suffers from poor data quality, they find it difficult to convince their associates to invest in initiatives that correct the problems. Earlier this year, we participated in Rob Karel’s Forrester research that addresses this issue. The resulting research paper is titled ‘A Truism for Trusted Data: Think Big, Start Small’ and its getting a lot of interest. . . . The report is available from Forrester’s web site. It contains some nice examples of how customers have built a business case for justifying investment in Data Quality.”

KRISTV.com: Squabble Heats Up Over Online Sale of Stolen Goods

“Lawmakers are pushing for a crackdown on online marketplaces, such as eBay, Yahoo, Overstock.com and others, for inadequate efforts to block the sale of stolen products on their platforms. . . . The proposed legislation is the latest skirmish in an ongoing battle over Internet intermediaries’ responsibility for their customers’ actions. Supporters of the bill want online marketplaces to more closely monitor transactions on their sites. They say the technology exists for the sites to track stolen goods sales, whether through targeting sellers who are known for proffering the products or hunting down frequently stolen goods.”

PogoWasRight.org: DHS Privacy Office - Privacy Impact Assessments

“The following Privacy Impact Assessments have been added to DHS’s site:”

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By the Infoglide Team

Wired Blog: Chertoff: I’m Listening to the Internet (Not in a Bad Way)

“The one thing we don’t want to do, because the culture of the internet is opposed to anything that smacks of government clumsy heavy-handedness, is that we don’t want to be sitting on the internet, like certain other countries do, where people suspect we are limiting what people can see. We don’t want to force people to do what they don’t want to do. We don’t want them to think we are intruding into their private space.”

AuctionBytes.com: Legislation Would Open eBay Records to Retailers

“House Resolution 6713 was introduced just weeks after the introduction of H. R. 6491, the Organized Retail Crime Act of 2008, which would require auction sites to cooperate with retailers and police and would allow retailers to sue over the sale of stolen merchandise. The National Retail Federation (NRF) issued press releases praising both proposals, stating that retailers lose between $15 and $30 billion to ‘organized retail crime‘ each year.”

Google Public Policy Blog: Now playing on YouTube: online family safety

“As a member and supporter of the Family Online Safety Institute, we are proud to let you know that FOSI recently launched its own branded YouTube channel. This YouTube channel represents one more example of how FOSI is identifying the best practices, tools, and methods for keeping kids safe online.”

The Bunker Blog: Charlotte, NC Shoplifting Statistics June 2008

“I’m afraid that, if we blame the economy, we’re just giving the thieves the excuse they need to steal more. If we ‘feel sorry’ for the thief who steals $150 shoes because times are tough, then we empower them to steal more because they feel entitled to our merchandise.”

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[Post from Infoglide] A Commitment to Solutions: What Harvard is Doing to Address Crime on MySpace and Other Social Web Sites

“Last week we focused on the issue of cybercrimes against children and how technology can play a role in preventing the victimization of young people on the Internet. One organization that is very much aware of the impact technology can have is the Berkman Center for Internet & Society at Harvard University.”

PogoWasRight.org: AU: Google Street View told: keep off, private

“Privacy activists and individuals have accused Google of deceiving the public by breaking its promises only to photograph public roads for its Street View mapping tool and to promptly remove images flagged as inappropriate.”

Fraud, Phishing and Financial Misdeeds: Bills Introduced to Combat Organized Crime on Auction Sites

“Criminals often lure people to do their dirty work, also. Recruits are normally harvested off the Internet, sometimes from job sites, and offered work to reship stolen merchandise and or launder money from fraudulent transactions. . . . A lot of criminal activity is facilitated on auction sites by what is known as phishing. Phishing is where an account owner is tricked into giving up their account details, either via social engineering, or more and more often, after downloading some malicious sofware. The stolen account details are then used to take-over the account and use it for illicit purposes. In fact, eBay and PayPal accounts are frequently the most phished brands out there. . . . There is little doubt that a lot of the criminal activity on auction sites is sophisticated and reeks of organized crime.”

Google Public Policy Blog: Keeping kids safe in a digital world

“Technology is an invaluable tool for addressing some of these challenges. . . . When it comes to keeping kids safe on the Internet, we believe that education for families, support for law enforcement, and empowering technology tools, like our SafeSearch filter and the NCMEC software, are all critical pieces of the puzzle.”

Evolution of Security: Answers to Your Top 10 Questions

“Here are the top ten questions we received from our recent request. We tallied the number of times we received each question or a similar version of it and noted the total for each question below.”

PogoWasRight.org: UK: Airport fingerprint plan sparks a domestic dispute

“Human rights and data protection organisations have criticised Government plans to introduce fingerprinting at all British airports where departure lounges are shared by international and domestic travellers.”

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