Mitek and DarkTower partnership presents a powerful new approach to identifying compromised data and combating fraud
The amount of check fraud and identity theft-related crimes emerging from online criminal marketplaces continue to rise. Today, Mitek (NASDAQ: MITK) announced its partnership with DarkTower, a cyber intelligence research company, to address the growing threat. During the first quarter of 2023 alone, the Federal Trade Commission recorded nearly $2 billion in losses from more than 750,000 reports of fraud and identity theft.
The partnership will give all customers of Mitek’s Check Fraud Defender real time access to compromised account data.
“The rise of nefarious activities has led to a proliferation of sensitive information being shared on criminal marketplaces and has increased the amount of identity theft and fraud taking place,” said Robin Pugh, president and CEO of DarkTower. “Our work includes identifying places where stolen information is being shared or sold and flagging this data to the proper parties to address.”
In an early test, Mitek and DarkTower provided a large financial institution with extracted data and supporting images. A small sample of 200 images from a single criminal marketplace processed through Check Fraud Defender revealed more than $10 million in customer funds at risk. The $10 million at-risk funds represents only a fraction of the potential value of documents available on these exchanges, with experts estimating thousands of similar active markets. The financial institution confirmed there was undetected fraud and there were claims paid related to the group of stolen checks. More than 90% of the claims showed additional counterfeit documents were distributed. This averaged $50,000 in losses per stolen document.
How It Works
Mitek uses DarkTower’s proprietary sourcing technology and its own state of the art image analysis technology to extract data from stolen documents such as checks, account screens, and identification documents sold on online channels and in marketplaces. Mitek delivers automated alerts for potentially compromised accounts to financial institutions and they can conduct victim searches in the MiVIP dashboard.
“Financial institutions now have access to the tools to defend against the newest and most sophisticated attack methods used by those attempting fraud, including AI-generated documents and criminal marketplaces,” said Michael Diamond, senior vice president and general manager, Mitek. “Integrating insights from DarkTower with our Check Fraud Defender service will enable financial institutions to move beyond passive defense to an active approach that reduces fraud losses and better protects their customers.”
According to The Consumer Sentinel Network, in 2022, there was nearly $8.8 billion in total fraud-related losses and incidents involving the use of fraudulent documents found in criminal marketplaces, including check fraud and identity theft. These activities will continue to rise dramatically as criminals combine traditional methods with advanced technology to perpetrate crimes. As this happens, it will become even more critical for institutions to implement technology solutions that decrease manual reviews and increase proactive responses to detect and prevent fraud from taking place.
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