As humans, we tend to take a lot of things for granted. This isn’t because we’re inherently unaware of it; no. We just tend to overlook things that are… not broken. Identity verification was not a primary concern for most companies until the covid-19 outbreak and the pandemic disrupted the physical ecosystem for businesses.
Identity theft existed even before the pandemic. In fact, it existed even in the ‘60s when the technology was still in its infancy. However, the same tools that you and I use are also used by those who are ill-intentioned.
This is why solutions like identity verification are now coming into play, saving businesses and individuals from scams, financial fraud, economic crimes, associated terrorism financing, and other related crime scenarios.
Identity theft existed then, it exists now. But thankfully, we have some authorized tools to combat identity theft and related issues. These tools enable compliance and regulation, giving them the term “regulatory compliance enablers”.
Today, we will discuss in detail how identity verification is saving businesses from non-compliance and related risks.
So, let’s get to it.
IRS TIN matching allows you to check if a certain taxpayer (entity, individual, vendor, recruit, etc) is in good standing with the IRS by validating the taxpayer identification number of the person/entity per the official records of the IRS. If the TIN furnished by the profile matches the official records, it’s a match.
This means that the profile is in good standing with the IRS. However, TIN Matching cannot be the only deciding factor for assessing the risk of a profile. Due diligence is necessary to gain insights on a profile from all perspectives. TIN matching is only an indication that the tax details furnished by the profile are in accordance with the IRS records.
Social Security Information Verification
Verifying the social security information of a profile, such as a name, place of birth, address, and other details are validated to check if the identities claimed by an individual are actually the real identities of the claimant.
The rise in identity theft is an indication that social engineers and ill-intentioned individuals are out in the free world claiming the identities of real people (who have zero criminal or risk history). In extreme cases, the fraudsters are even taking the identities of the deceased to function without resistance in the real world.
By validating the social security information, you can easily check if the identities claimed by a certain person are the real identities of that person. Due diligence, adverse media screening, validating the proof of identity, and other forms of investigations will help you dig deeper and find the sources of identity theft.
The Office of Foreign Asset Control is an authoritative agency of the U.S. government that administers and monitors national security through sanction programs.
The OFAC data lists include a collective of checks, such as Foreign Sanctions Evaders List, Excluded Parties List System, List of Excluded Individuals/Entities, Designated Foreign Terrorist Organizations, and more.
These checks help you drive your compliance operations to the next level wherein you can identify sanctioned individuals/entities, those who are engaging with sanctioned individuals or entities, terrorists in the garb of civilians, and money launderers who are on the federal watch lists from a long time.
By verifying the identities of individuals or entities against OFAC watch lists, you are assessing the severity of risk, eliminating the risk of associating with noncompliant profiles, and preventing financial and civil liabilities from the federal agencies.
Politically Exposed People Check
This data list allows you to check if a profile has a recorded history of money laundering, suspicious financial background, narcotics trafficking, and other federal crimes. This identity verification check gives you the feasibility to utilize your investigative efforts within reason to screen a profile for adverse media coverage, monitor transactions, and even submit a Suspicious Activity Report.
This is especially relevant in scenarios where the profile gives you ample indications that the nature of the activities in which they conduct is neither legal nor lawful.
Identity verification checks help individuals and businesses alike to skip through the possibilities of risk and choose profiles and business arrangements that come with zero risk and great value. By conducting identity verification checks as described above, businesses are not just protecting their businesses from non-compliant profiles, but preventing associations with high-risk profiles that could bring reputational, financial, and civil liabilities.
Given the rate at which identity theft, money laundering, terror financing regimes, and other illegal activities are making their way into the mainstream perspective, it is essential for businesses to tighten their KYC compliance criterion through robust customer/client identification procedures.
TIN Verify can help navigate your business through an ocean of noncompliance by fusing identity verification infrastructure that adapts to your business ecosystem.