Security Report Reveals Fraudsters Passed “Knowledge Based” Authentication Questions 92% of the Time

Pindrop, which claims to be an international leader in voice tech, recently shared its annual Voice Intelligence & Security Report “uncovering how companies might be accidentally inviting fraud, threat mongers from the dark web and bad actors better prepared to pass authentication.”

As noted in an update shared with CI, data dealers are “growing more sophisticated, offering more service, more details, and more organized information.”

Because of this, 2021 was “a record-breaking year for data breaches.”

In fact, Pindrop found that bad actors “actually had better performance than genuine customers at answering ‘security questions’.”

The data illustrates this security weakness “when used as an authentication method, as well as the impact on genuine customers who will often fail to pass authentication with this security system.”

Additional key findings include:

  • 92% of fraudsters passed knowledge-based authentication (KBA) questions based on a national contact center case study, while genuine customers only passed KBA’s 46% of the time
  • Organized crime rings have now set up storefronts on the dark web and have become illicit data vendors and even offer return policies
  • Customer satisfaction with the identification process is higher online than via phone call
  • 65% of enterprise company board members expect customer engagement/loyalty to improve as a result of increased investment in IT, technology, and digital business capabilities
  • 12% of the time, retail and insurance company agents failed to verify customers’ identities

Vijay Balasubramanian, CEO and co-founder of Pindrop, stated:

“With 2021 seeing a sixty-eight percent increase in data breaches, bad actors are compromising data easier and more efficiently.  Now is a good time to change the locks and advance the way customers can open more worlds safely and privately with just their voice.”

Data breaches and the dark web are “destroying a provider’s ability to use knowledge-based or out-of-wallet questions to authenticate customers.”

As board members demand better customer experience, it’s shown that customers “prefer more advanced authentication methods than they are currently receiving over the phone.”

The report examines “how authentication and identification technology that allow people the right access have a dual nature.”

While the systems are designed to let users in, these programs also “have the ability to let in individuals who are not the user.”

To stay protected and secure, it is crucial “to understand how bad actors rely on certain authentication methods to commit fraud.”

Data was based “on confidential Pindrop analysis of a large sample of contact centers across several industries, fraud calls and total call volumes.”

Additionally, KBA statistics were “based on a controlled Pindrop study with two national contact centers over a period of three months.”

In an increasingly digital world, Pindrop lets people “use their voice to seamlessly connect to, enter and unlock new experiences while helping safeguard their privacy.”

Using its patented voice authentication technology, Pindrop claims that it “is leading the way to the future of voice by establishing the standard for identity, security, and intelligence for voice interactions.”

Working with some of the world’s biggest banks, insurers, and retailers, Pindrop “enables customers to quickly, conveniently, and securely connect to the information and resources they need.”

Its voice authentication technology analyzes unique features “within the human voice and surrounding audio that enables its customers to prevent fraud and deliver exceptional customer experiences in call centers, when obtaining information from smart devices, and even when activating cars.”

A privately held company, Pindrop “is venture-backed by Andreessen Horowitz, Citi Ventures, Felicis Ventures, CapitalG, GV, IVP, and Vitruvian Partners.”

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