Getting to Know You

When doing business in the bricks-and-mortar world, requiring a picture ID with face-to-face transactions is a standard, cheap and competent guard for reducing fraud and underage use of products.

E-businesses don't have such a luxury.

They do, however, have access to tools designed to insure against the perils of fraud and underage access.

Companies like Experian and Aristotle have gathered massive stores of information that can be used as part of a service that approves or denies users based on just a small amount of information.

Experian, the England's largest credit bureau, has developed a range of identity- authentication and age-verification systems under its e-identity brand. Clients employ the services online by installing an XML java applet plug-in into their backend systems or access the services via Experian's Web-hosted service at www.e-identitycheck.com.

Experian, which serves the United Kingdom only, has a vast database of regularly updated information from several sources as is main asset. Its mainframe stores huge amounts of public information, like the voters roll, court documents, and telephone directories, as well as its most important source of data-- the credit account information sharing (CAIS) directory. The CAIS files, which have roughly 250 million records on the United Kingdom's population about 50 million adults, reflect credit behavior and are used by many organizations to determine credit worthiness as part of consumer credit applications.

The e-identity services, however, are not concerned with an individual's financial position. The credit information is relevant because it verifies that the user has a relationship with a credit bureau and that sufficient information is available to verify this person.

In the gaming industry, name, address and date of birth provide sufficient information for Experian's system to check with its database and make a decision regarding the legitimacy of the user. Experian's server returns a score index, ranging from 0 to 90, that reflects the degree of confidence it has that the user is who he or she claims to be. The client, who never sees the individual's information, can then decide how best to proceed based on the score returned. An "accept" score will also confirm that the individual is over 18 years old.

e-identity can make decisions quickly because its CAIS accounts are updated by each lender every month. Constant updates combined with such vast scores of records insure that legitimate users will never be turned away from client sites.

"Experian's differentiator is that we have a solution that is able to accept the maximum number of legitimate people while refusing those people who quite correctly should be refused," Jeremy Hill, Experian's business development manager explained. "There is no point in a system that can find all your fraudsters if it is also referring half your population out because it cant make a decision on them."

Individuals cannot be found in public data or in the CAIS files until the age of 18. To address minors, Experian provides Interactive Age Check, a complementary solution that authenticates the identity and age of juveniles between the ages of 13 and 18, as well as Citizencard, a third-party solution.

Experian has recently had been picking up business in the gaming industry; its gaming clients include Camelot, Ladbrokes, Sky Bet and Rank/ Hard Rock.

Aristotle takes a different approach. Rather than using demographic and credit information, Aristotle's VerifyMe service checks all of its user information against a database of government-issued identification. Aristotle uses official government IDs from all 50 U.S. states as well as IDs from 157 other nations.

Like Experian's solution, businesses integrate the VerifyMe service into the back ends of their Web services, making users unaware of its presence. Alternatively, they can provide a customized link to the VerifyMe Web site, where the user can be verified.

For gaming sites, Verifyme requires the client to supply a user's name, date of birth, and zip code. That information is sufficient to verify user information against their records. The server can process information and send an error or acceptance code in under five seconds 90 percent of the time.

VerifyMe, the only service in the world to rely strictly on government IDs, is designed to be fully compliant with the Patriot Act. It also insures all of its clients' transactions up to $1 million in the case of lawsuits involving underage sales, although as of now, none of its clients have ever been sued.