As socially focused apps and services race to adapt to lower thresholds under Visa’s VAMP, BrightCheck is helping them reduce chargebacks through a combination of social verification and payment security. Founder and CEO Scott Bright said it’s a combination that can help companies in many other verticals, too.
BrightCheck performs anti-catfish, social media, and criminal checks. They serve dating and social platforms, cryptocurrency exchanges, online marketplaces, hospitality management, and those accepting push payments. Individual consumers can also use BrightCheck to verify people they interact with online.
Bright, a payments veteran with experience at Visa and FIS Global, said many marketplaces, gaming sites, and social platforms run into trouble because they don’t verify registrants up front. Free trials and annual payments provide little opportunity to amass a behavioral history.
But it’s a big problem for the dating app industry, where Bright estimates 25% of profiles are fake. Scammers lure victims, then take them off-site to bilk them. That creates reputational risk, leading such platforms to pay for verification checks. With many new customers opting for free trials, some checks are cost-prohibitive.
“The challenge with these dating apps and peer-to-peer marketplaces with first-party fraud is that they’re not going to hit those Compelling Evidence Requirements,” Bright noted. “You need to have two previous transactions. It’s one transaction, and the customer finds a little bit of life for five, six months, and then maybe do another transaction. But that’s what the first-party fraud is.”
How BrightCheck works
Give BrightCheck a first name and phone number, and it verifies identity, checks criminal history, and uses IP addresses to access a host of databases. It leverages AI, large language models, and neural networks to establish important linkages.
“When people are coming in the door of dating apps, marketplaces and others, let’s verify them,” Bright said. “We package all this stuff up as part of the compelling evidence package that goes to the issuing bank, saying we know this person. They don’t have any of that information.”
BrightCheck delivers value by creating a history and supporting evidence that helps effectively monitor chargebacks. Bright said it brings continuity that a rotating cast of analysts cannot establish. Other sectors are interested in the technology, including professional sports, online vendors, and delivery services. They need assistance with providing effective data for fee disputes.
Criminals are quick to manipulate new technologies like AI and code injections as they seek to stay ahead of their victims. Some struggle to adapt to different cultural norms, like naming sequences. This helps fraud detectors to isolate them.
Bright believes this will soon render physical biometrics useless. The combination of behavioral biometrics, personally identifiable information and IP checks is much better at leveraging something you have, know and are.
“Let’s create the railroad tracks here, with all these plugs into these companies,” Bright said. “And, you have the direct-to-consumer app where we’re tying it all in effectively. A consumer can put it into Bumble, eBay, or their bank. They can effectively use it like a digital identity.”
VAMP’s a headache for businesses, whether they know it yet or not
Bright said VAMP, and its several modifications, have contributed to customer apprehension. Combine that lack of finality with the human tendency to delay, and many are panicking in the Oct. 1 lead-up. Many social apps expect a 3% chargeback rate, well above the thresholds.
“It’s a black swan event,” Bright said. “I’ve probably gained more client meetings in the last two weeks than I had in the last two months. What we’re trying to say is that Oct. 1 is coming fast. And if you’re not worried about Oct. 1, I can promise you will be on November 1, when you get your bill, because it’s going to have these huge markups.”
“These are peer-to-peer marketplaces, online gaming, and social platforms. What I’m hearing as well from these guys is that 75% is first-party fraud and doesn’t qualify for the new compelling evidence 3.0 requirements.”
Bright said the perfect merchant-client relationship begins with checking them at the front door and continues with perpetual monitoring of transactions and other key touchpoints. Looking ahead, he wants to see first- and third-party bad actor lists and compelling evidence letter automation.
As his technology matures, Bright knows BrightCheck offers a compelling proposition to many sectors.
“We’re at the intersection between payments and social; it’s our lifeblood,” Bright said. “We want to develop these kinds of lists and early warning detection that can be used by social platforms, and also be tied into financial sectors like crypto and P2P transactions. It’s all bleeding together, and we want to be that centralized node.”