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This thread is sponsored by Verisio
During this post you will be educated on the most prevalent factors that lead to account locks or increased risk score that have been observed by our team over the years.
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Transaction Size:
In most cases, KYC verification is performed before you are able to make transactions. However for some platforms such as MoonPay, you are required to attempt a transaction before you are able to verify your identity. This gives the fraud prevention team a data point to reference when determining your risk score. A high risk score can lead to increased requests for information such as requesting excessive documents or even requesting a video call. At Verisio, we counteract these measurements by performing low-level transactions carefully calculated in order to circumvent any automatic detections that flag our accounts.
Regulatory Compliance:
During major economic crisis, it has been seen time and time again that the governments in many tier 1 countries have started implementing heightened AML laws and enforcing regulations in the form of pressuring financial institutions to comply. The reason many financial institutions perform rigorous KYC checks is not because they want to, it is because they fear hefty fines from governments. It would be in their benefit to allow money laundering and illicit funds to flow through their platforms because it elevates their revenues and profits and also allows them to show inflated statistics to investors. At Verisio, we analyse the current financial and fiscal situations in our target countries in order to understand any tensions that may result in heightened AML checks. With this information we may switch from one country to another. An example of this is verifying using Israeli documents. Pre-war, Israel documents were treated as any other documents were. Now with a heightened socioeconomic climate, many compliance teams are applying extended verification checks including liveness checks and in some cases outright declining applications. This is because Israel citizens may be desperate to raise money for necessities and as a result they may sell their identity documents for money.
Transaction Patterns:
One of the most common methods of detecting unusual activity on any platform is by monitoring usage patterns. Nowadays this has been automated by many companies as it is hard to analyse their millions of users manually. On the surface this could be seen as bad because you cannot slip through the cracks anymore, anything that matches their criteria of suspicious activity will result in an instantaneous account suspension and require a KYC check. However, this can be used to our advantage because the parameters for their automated pattern detection is very rigid. If the patterns are studied hard enough, we can determine what set of transactions makes an account remain in good standing and what transactions destroy an account. At Verisio, we study transaction patterns for all our products in order to categorise how to correctly warm up an account for large volume usage.
Identity Reputation:
One method that is frequently overlooked when creating verified accounts on financial platforms is identity reputation. This is the quality of the information you provide. Some may think that this is limited to the fullz (full information; the identity of a user) that you provide, however it can also expand to IP address, fingerprint, email reputation and other identifying attributes such as phone numbers. An attribute we have observed being misplaced more recently is phone numbers. A phone number is apart of your digital identity, normally tied to all of your accounts, banks and insurance. Many traditional financial institutions have the ability to check background reports and other official records to see if that phone number belongs to you. This is a non-recurring theme which only occurs on traditional institutions that have the outreach required to obtain such tools. Virtual banks, crypto exchanges and smaller financial institutions all use the same factor: VOIP/Real. This is where they run the number you provide them through a carrier checker and determine whether the phone number is a VOIP phone (online) or a real phone (physical). If you attempt to use a VOIP number repeatedly, it can leave a bad record on your account which can increase your risk score and lead to more problems later. At Verisio, we prevent a decrease in risk score by using real phone numbers on most of our accounts which will bolster the reputation of the account to ensure no issues occur.
Information Sharing:
It is widely known that many platforms, especially in the cryptocurrency industry, have their own "war rooms" to pass around information to fraud team representatives across a wide range of different companies. An example of this could be that Bank of America has just detected a suspicious sign up using a Venezuelan identity, so they pass information across to the war room full of fraud team representatives from a range of different companies such as Chase, Gemini, Binance and Wells Fargo so that if the same Venezuelan identity registers on any of their websites, then they can perform enhanced KYC checks or even deny the application. At Verisio, we eliminate this risk by using fresh identities on all of our accounts, unused anywhere else. This ensures that your account is not flagged and you will receive the same treatment as everyone else.
[/HIDE]
During this post you will be educated on the most prevalent factors that lead to account locks or increased risk score that have been observed by our team over the years.
[HIDE]
Transaction Size:
In most cases, KYC verification is performed before you are able to make transactions. However for some platforms such as MoonPay, you are required to attempt a transaction before you are able to verify your identity. This gives the fraud prevention team a data point to reference when determining your risk score. A high risk score can lead to increased requests for information such as requesting excessive documents or even requesting a video call. At Verisio, we counteract these measurements by performing low-level transactions carefully calculated in order to circumvent any automatic detections that flag our accounts.
Regulatory Compliance:
During major economic crisis, it has been seen time and time again that the governments in many tier 1 countries have started implementing heightened AML laws and enforcing regulations in the form of pressuring financial institutions to comply. The reason many financial institutions perform rigorous KYC checks is not because they want to, it is because they fear hefty fines from governments. It would be in their benefit to allow money laundering and illicit funds to flow through their platforms because it elevates their revenues and profits and also allows them to show inflated statistics to investors. At Verisio, we analyse the current financial and fiscal situations in our target countries in order to understand any tensions that may result in heightened AML checks. With this information we may switch from one country to another. An example of this is verifying using Israeli documents. Pre-war, Israel documents were treated as any other documents were. Now with a heightened socioeconomic climate, many compliance teams are applying extended verification checks including liveness checks and in some cases outright declining applications. This is because Israel citizens may be desperate to raise money for necessities and as a result they may sell their identity documents for money.
Transaction Patterns:
One of the most common methods of detecting unusual activity on any platform is by monitoring usage patterns. Nowadays this has been automated by many companies as it is hard to analyse their millions of users manually. On the surface this could be seen as bad because you cannot slip through the cracks anymore, anything that matches their criteria of suspicious activity will result in an instantaneous account suspension and require a KYC check. However, this can be used to our advantage because the parameters for their automated pattern detection is very rigid. If the patterns are studied hard enough, we can determine what set of transactions makes an account remain in good standing and what transactions destroy an account. At Verisio, we study transaction patterns for all our products in order to categorise how to correctly warm up an account for large volume usage.
Identity Reputation:
One method that is frequently overlooked when creating verified accounts on financial platforms is identity reputation. This is the quality of the information you provide. Some may think that this is limited to the fullz (full information; the identity of a user) that you provide, however it can also expand to IP address, fingerprint, email reputation and other identifying attributes such as phone numbers. An attribute we have observed being misplaced more recently is phone numbers. A phone number is apart of your digital identity, normally tied to all of your accounts, banks and insurance. Many traditional financial institutions have the ability to check background reports and other official records to see if that phone number belongs to you. This is a non-recurring theme which only occurs on traditional institutions that have the outreach required to obtain such tools. Virtual banks, crypto exchanges and smaller financial institutions all use the same factor: VOIP/Real. This is where they run the number you provide them through a carrier checker and determine whether the phone number is a VOIP phone (online) or a real phone (physical). If you attempt to use a VOIP number repeatedly, it can leave a bad record on your account which can increase your risk score and lead to more problems later. At Verisio, we prevent a decrease in risk score by using real phone numbers on most of our accounts which will bolster the reputation of the account to ensure no issues occur.
Information Sharing:
It is widely known that many platforms, especially in the cryptocurrency industry, have their own "war rooms" to pass around information to fraud team representatives across a wide range of different companies. An example of this could be that Bank of America has just detected a suspicious sign up using a Venezuelan identity, so they pass information across to the war room full of fraud team representatives from a range of different companies such as Chase, Gemini, Binance and Wells Fargo so that if the same Venezuelan identity registers on any of their websites, then they can perform enhanced KYC checks or even deny the application. At Verisio, we eliminate this risk by using fresh identities on all of our accounts, unused anywhere else. This ensures that your account is not flagged and you will receive the same treatment as everyone else.
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