It's a bull market for digital crooks, who are using a dispersed and rapidly automating world to find new ways to attack the bank accounts of folks that already have enough to worry about. But one advantage the banks and merchants have is Carey O'Connor Kolaja.
Kolaja, one of PaymentsSource's Most Influential Women in Payments for 2021, in late 2020 became CEO of AU10TIX, an Isreali global ID and authentication specialist. Kolaja brought experience at Citigroup and PayPal to her new job, as well as a keen sense of how rapid innovation is democratizing financial services, but also creating new risks.
How bad have these fraud risks gotten? In a recent interview,
And once into a school, scammers can nab information that can fuel payment account theft and fraud in other venues.
"Every time a person has a digital interaction, it opens up a point of entry for fraudsters to capture pieces of personal data," Kolaja said. "A consequence of vulnerabilities in enterprise technology, fraudsters have gained the ability to actually create identities by collecting breadcrumbs of information people leave online."
A subsidiary of ICTC International N.V., AU10TIX sells technology that speeds authentication and onboarding, and helps firms manage compliance and fraud prevention. AU10TIX's backers include TPG and Oak ft/hc.
Before joining AU10TIX, Kolaja was global chief product officer at Citi Fintech and vice president of global consumer products at PayPal, where she was responsible for spotting new innovation and commercial strategies to meet the developing needs and interests of customers in global markets. Kolaja led international teams that designed, deployed and operated global product and commercials strategies in more than 200 markets, residing at the intersection of finance and technology during a time of great growth and change.
In her newest role, Kolaja is putting that experience to work in the frontiers of authentication, and digital ID. Fraudsters have gotten particularly adept at digital forgeries and synthetic identities, which is hard to detect: nearly 95% of synthetic fraud gets past traditional fraud models, according to the Federal Reserve. As the number of online interactions per individual climbed up to 5,000 per day from the 700 to 800 that people averaged at the start of 2019 , digital fraud has grown by 300%. And birth dates, Social Security numbers, medical history and financial information have all become easier to steal to create fake accounts.
"Without the proper data protection put in place by businesses, cybercriminals are taking advantage of the exponential growth in digital transactions to collect more and more information," Kolaja said.
Behavior analysis has long been part of spotting unusual behavior and transactions, and that will have to improve. Adaptive analytics and data will be required to spot identity risk based on historical behaviors to prepare for these new vulnerabilities, Kolaja said. "Identity is core to everything we do; it is the key that unlocks access and opportunities for individuals and businesses," she said.
The accelerated digitization of banking and payment systems has also been good news, as business and consumers have gained more options to access the financial system, a trend that can contribute to the economic recovery that follows the pandemic.
"Advances in mobile money, fintech services, and online banking make transactions fast, simple, easy to understand, and much less expensive," Kolaja said. "For the two billion people in the world living outside of our financial system, the use of technology can make a meaningful contribution to financial inclusion."
