Heroes in Business - Experian Identity Report, Identity and Preventing Cryptocurrency Fraud with David Britton

Episode Date: December 20, 2022

Experian Identity Report focuses on Identity and Preventing Cryptocurrency Fraud with David Britton, Vice President of Strategy for Global Identity and Fraud for Experian North America, interviewed by David Cogan famous host Heroes Show and founder Eliances entrepreneur community. Special reports from Experian about the game changing impact of identity and the need to use reliable data to make confident decisions that safely accelerate customer engagement.

Up in the sky, look, it's captivating, it's energizing, it's Eliance's Heroes. Eliance's is the destination for entrepreneurs, investors, CEOs, inventors, leaders, celebrities and startups, where our heroes in business align. Now here's your host flying in, David Kogan, founder of Eliance's. That's right. And guess what? It's time for the Experian Identity Report. And we're joined with, again, with David Britton. He is the Vice President of Strategy for Global Identity and Fraud at Experian, and he can be reached at Experian.com. In fact, it's truly incredible because, David, you were actually really one of the first internet fraud

investigators. I mean, how do you like having that part of your bio? Yeah, it's been a long journey. I'll tell you, I feel really old when we say that, but that's what we think. It was, you know, mid-90s in Silicon Valley when this dot-com thing was getting kicked off. Now, I think it's important because today what we're going to talk to is a hot topic. It is mentioned every day, probably every five, 10 minutes in business news and consumer news and that. In fact, I'm going to get right into it too. From what I understand is that banks and other financial institutions are under constant pressure to prevent fraud. It happens at an unbelievable amount of rates. And the latest threats come really from the world of crypto and blockchain. It is what it is. However, you know, there's newly initiated crypto is digital designed to work as a medium or exchange for buying, selling and transferring. Right. And some consumers were still trying to

understand it all. But there's a lot of fraud that's with it. So let's talk about, David, the risks associated with crypto and fraudsters really who operate in this environment. Yeah. First of all, thanks again for having me, David. It's always a pleasure. And you're right, crypto is a really hot topic. And there are risks associated with crypto. And when people think about crypto, they think, well, it's a really volatile currency, right? Even though people don't necessarily understand all of the inner workings of it. You've seen in the news that cryptocurrency keeps going up and down, right? That's one level of risk. But the risk that we're talking about here is perhaps more of the really dangerous risk, which is the risk of fraud in this environment.

You have to remember the internet itself and the digital environment is an anonymous one by design and by nature. It's never been designed with security in mind. There's no underlying security protocols on the internet. There are some things that we've added to it, but anonymity is a big part of that. And cryptocurrency is sort of the latest incarnation of really anonymous ways of moving money around. Well, if you're a bad guy, that's like a dream environment for you. If you're trying to move money and you don't want governments or others to know about it or to steal money, cryptocurrency becomes a really effective way of doing that.

And it's been a bit of a wild west over the last several years that they've taken full advantage of. And now they've moved not just to moving their own money around, but to stealing from people that may have accounts in the space and how they do that is part of the discussion we'll have. But what are the different ways that fraudsters can attack crypto and the banks and really financial institutions that hold it? I mean, there's so many ways that they can go ahead and write and attack it, attack them. And then we're all affected by it.

Talk to me about that, please. The risks. Yeah. So it helps to understand a little bit, perhaps, of how crypto works. Like, how do you get cryptocurrency? Well, you have to buy it, right? And so how do you buy it? Well, you buy it with real money. That's the first part. So the way you do this is that people will set up, they'll put a, they'll set up a link between an existing bank account or credit card, and then go and purchase cryptocurrency using that money.

So now you're turning real, what we call fiat currency dollars into cryptocurrency. Once you've done that, well, first of all, that connection right there is where the fraudsters are already taking advantage. They may actually break into your bank account and set up a connection to a cryptocurrency exchange and start to on-ramp your money into their bank account and set up a connection to a cryptocurrency exchange and start to on-ramp your money into their cryptocurrency account. And that's what we call an account takeover of your traditional bank account. So they're not actually doing anything in the crypto side yet, but they're just stealing your login credentials and they're logging into your bank account and setting up a connection to a cryptocurrency account and moving money out.

and setting up a connection to a cryptocurrency account and moving money out. So that's the first way. The second way is that they can start to gain access and do the same thing. If you have cryptocurrency, they can take over, try to break into your cryptocurrency account and move money around. And then the third one that we see is that there are a lot of scams. There are a lot of people that are being convinced to move money by crypto or there's promises of great returns on cryptocurrency. So you should move your money in here. And oh, by the way, I'm going to be your broker. So make sure I have access to your crypto account as well.

And so there are some scams that people are unfortunately falling prey to where the fraudsters are aggressively working with social media to try to get people to go invest in crypto. And then they will actually drain those accounts because they have joint control over them. So there's a number of different ways the fraud is happening in this market. Now, the important thing, though, too, is what role really does the identity play in preventing crypto fraud? How does that take place? Yeah. So identity becomes really important because, as we said, if the internet is anonymous, even in your traditional bank, where banks are slightly different is that there's regulations by the government that says if a bank

is going to serve a customer, the bank has to know your customer. It's called KYC, know your customer. And there's a whole set of requirements that the bank has to go through to do that. When you get into non-regulated markets that are not banks, like cryptocurrency or even e-commerce and other things, there's no requirement from the government to do that. But in a digital world, knowing who's on the other end of the wire is critical if you're going to have a safe and growing business, or if you want to serve your customers well, right? You have to know who you're serving. So identity becomes a bit of a cornerstone to how you actually serve your customers well and prevent fraudsters from gaining access. And so identity

starts to live at the heart of good business practice and fraud prevention and risk mitigation. Well, so David, I think it's important and we we need to know this really, is what is Experian doing really to prevent this fraud? In fact, too, is this either identity products, solutions, other things that Experian actually offers, has developed, has come out with? Yeah, there are several. And I think the way to think about it is if we think of identity in the offline world, right? And I think the way to think about it is if we think of identity in the offline world, right, when I've met you, David, you and I have met each other.

I know what you look like. I know how your voice sounds. I know generally how you interact with me. All of those things are part of the identity that I associate with David Kogan and you associate with me. What we have in the digital world is we're all represented by our proxies, which are our devices, right? A device is a proxy for me online because I'm not literally online myself as a physical human being. If you take that same analogy, though, and you start to look at the various elements of data that might be useful to build a profile of an identity of a person, which device do they use? David often uses an iPhone. So

is this person using an iPhone or is it a different device, Android device? How, you know, are there are identity verification products like is this name, address and date of birth? Does this actually align to David Britton or not? And so Experian has a whole series of capabilities, both what we would call traditional identity verification capabilities on identity data, but then also technologies and digital capabilities that we can bring together. And then we also have the technology that allows us to stitch all of this together to have a better understanding in a way that allows us to really say, this is actually David. And it's important that you know that it's David before you allow them to do transactions on your site or in your business. And that we extend that then to helping people, helping banks and others, crypto exchanges to not allow fraudsters to come into the wrong bank account, right? We have easy ways to do that. And so those are the kinds of things

that we'll layer in as part of the overall sense of an identity profile in the digital world for the purposes of keeping great client engagement and good consumer experiences alive, while also immediately being able to identify fraud. That's great. And again, we have all different types of listeners. And I probably could tell you, safe to say, we have bank presidents, people in the banking world in that. So really, what's the call to action for these banks and others that are currently offering crypto to their customers? Yeah, I would say reach out to Experian. And if you have an Experian representative already, talk to them about what we can be doing. Because in digital identity, as well as digital risk management, It starts with when you open up a new account.

It goes to when people are logging into your accounts. It goes to are they moving money in and out of your accounts. And we have solutions that can cover the entire breadth of the journey of the consumer. And if you're hoping or thinking you need to move into engaging and putting crypto as an offering in your system or connecting to cryptocurrencies, allowing you to do so, we've got solutions that can help you do that safely. Well, David, again, thank you so much for the segment today for the Experian Identity Report.

It's this critical information that people have got to know. Again, we've had with us David Britton, Vice President of Strategy for Global Identity and Fraud at Experian. He can be reached at Experian.com. You know he doesn't sleep because he's constantly working on helping to protect and keep people safe. That's right. This has been David Kogan with the Alliance's Hero Show.