Identity Resolution Daily

By Douglas Wood, Infoglide Senior Vice President

On the heels of the very successful Association of Certified Fraud Examiners (ACFE) conference last month comes an industry event which represents investigators of financial crimes and fraud.  The International Association of Financial Crimes Investigators (IAFCI) meets in Washington, DC next week with an agenda that is chock full of sessions involving discussions of best practices for solving and preventing financial crimes.

With an audience looking to share thoughts on insider trading detection, mortgage fraud, organized crime ring detection, anti-money laundering and insurance claims fraud, the conference is sure to be buzzing!

One thing for certain is that there is no one “right” answer to prevention and investigation.  As I pointed out in a previous post here, it is clear that predictive analytics technologies have been a valuable tool for organizations to “catch” fraudsters based upon their behaviors.   With more and more organizations adopting identity resolution technology, however, those “best practices” are becoming even better.

Identity resolution technology goes at the heart of who’s who… and who’s working with whom… by “gliding” across an organization’s data (internal and/or third party) and searching for those tiny pieces of forensic data attributes that are the golden nuggets of financial crime investigation.  Identity resolution helps investigators understand the identity matches and non-obvious relationships between individuals across enterprise data – despite input errors or deliberate attempts to deceive.

In combating financial crimes, identity resolution technology has become the next big ‘thing’, as it provides answers to the following types of questions:

• Does someone in an incident database resemble someone in another database… and who else is connected to them?
• Is the witness in an insurance claim suspiciously similar to someone in the SIU data?
• Do credit card applicants share subtle attributes that would point to bust-out fraud?
• Does the loan applicant have a non-obvious relationship with an employee?  Or a known fraudster?
• How is the stock trader connected (by degrees of separation) to an insider?
• Is an applicant somehow connected to a Denied Person?

Infoglide Software Corporation, the leader in identity resolution engine technology, will be attending IAFCI next week and we would encourage you to drop by our booth and say hello. Otherwise, drop a note to sales@infoglide.com and I will have someone reach out to you directly to explain how this all works.

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By Douglas Wood, Infoglide Senior VP

The Association of Certified Fraud Examiners (ACFE) held its annual conference and exhibition in Washington, DC this week.  Through the keynote address and the plethora of wonderful speakers, one message became loud and clear - fraudsters are becoming more and more creative in finding ways to circumvent your policies.

We heard stories of insider trading, bust-out fraud, mortgage fraud, insurance claims fraud and organized retail crime.  Despite the diligence and hard work by the certified fraud examiners, too many of these stories ended up with a common theme - the crooks got away with an awful lot of booty before getting caught.

Predictive analytics and behavioral analytics have provided organizations with a great weapon in combating fraud.  Establishing norms and ranking activities against those norms can have a dramatic effect on reducing losses to fraud and crime.  What has been missing, however, is the wide-scale adoption of a tool that allows fraud examiners to “automatically connect the dots” between the bits and pieces of forensic information they have.  Identity Resolution is that tool… and it has been the talk of the conference here.

The powerful federated similarity search capabilities of identity resolution help investigators understand the hidden relationships between individuals across enterprise data (Applicants, SARs, Incidents, Employees, Claimants, Witnesses, etc).  Let’s face it, the fraudsters are typically not stupid.  They know how to get around the systems by engaging their family and friends to form a profitable fraud ring.  Identity Resolution gives companies the power to search into ALL their data with  a view to understanding “who’s who” and “who’s working with whom” - despite deliberate attempts to deceive.

We believe this technology is becoming absolutely critical for corporations to predict and examine fraudulent activity, and that mainstream adoption is happening right now.

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By Robert Barker, Infoglide Senior VP & Chief Marketing Officer

What’s it going to take to move the data quality space forward in the future? That’s the question recently addressed by Ted Friedman of Gartner as reported in an article in destinationCRM.com. He suggests that the real answer may be messaging.

“Vendors have done a reasonably poor job in that they could get better at articulating the true business value [of data quality solutions],” he says. The Gartner analyst notes that vendors tend to talk about functionality in terms of technological advances, rather than conveying how that technology actually supports the business infrastructure. Friedman also notes that, in general, vendors could get better at articulating how tools support initiatives such as information governance and regulatory compliance — two notable industry trends.

Ted is right that to call out vendors to improve our messaging. At Identity Resolution Daily, we get down into technical details fairly often. For example, our bloggers have talked about data matching, its relationship to identity resolution, critical requirements for identity resolution, and we’ve had a series on data quality. Professor John Talburt of UALR’s Center for Advanced Research in Entity Resolution and Information Quality (ERIQ) is a regular contributor who talks about technical definitions and issues surrounding these topic areas.

That’s not to say that business issues around entity resolution and information quality have been ignored. Real world problems like lottery retailer fraud have been a frequent topic, as has organized retail crime. Another business problem we’ve talked about is employers trying to cheat workers compensation laws, and we’ve actually discussed regulatory compliance (OK, so we did get a bit technical on that one).

A huge issue related to information governance is preserving the rights of individual privacy. Because of our involvement in TSA’s Secure Flight program, we’ve written about this issue repeatedly since Identity Resolution was created. A recent post captures the essence of the issue.

So at best, I’d have to say we get a C+ or a B- on our messaging. With our upcoming release of IRE 2.2, we’ll make every effort to respond to Ted’s constructive criticism of the data quality space.

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[Post from Infoglide] Speaking of Narrative Fallacy

Nassim Nicholas Taleb’s book The Black Swan: The Impact of the Highly Improbable uses “narrative fallacy” to describe how we humans tend to enhance ex post facto our ability to predict events that in fact are extremely complex and random. A recent post on Netrics HD attempts to leverage this argument to demonstrate the superiority of “Machine Learning” (i.e. probabilistic analysis) over “data matching” (i.e. deterministic analysis).

advance: Security and Privacy Challenges to EHR Adoption

“Lest we forget, our country is trying to establish similar capabilities with the widespread initiative to implement electronic health records (EHRs). My health history should travel with me — just as easily as my financial information. With some sort of authentication process, a “core” set of data should be easily available to assist in my receipt of health services.”

New York Times: Flying? Don’t Book Under a Nickname

“The government’s aim is to streamline the process of checking travelers’ names against its watch lists — a task currently handled separately by each airline — and to collect more detailed information so passengers with names similar to those on the watch list are less likely to be mistakenly detained. Asking for a birth date, for instance, decreases the likelihood that a child with a name close to one on the list would be subject to an additional search — one example of a false match that has led to complaints.”

Integrated Solutions for Retailers: Organized Retail Crime: Scope, Solutions

“Popular targets of organized retail crime rings include Crest Whitestrips, Rogaine, Similac baby formula, razor blades, and pregnancy tests. Having not been stored or managed properly, these items can pose serious health risks for innocent shoppers looking for a good bargain. And, because most of these items are sold “new in box,” well-meaning consumers are unaware that what they purchased may be spoiled or expired  —  and stolen.”

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By the Infoglide Team

BI Blogs: Business Intelligence - The Unconquered Territories

“Let’s face it - There are technology limitations. Operational BI (Lack of real-time data access), Guided analytics (Lack of comprehensive business metadata), Information as a Service (Lack of SOA based BI architecture) are some of those technology limitations that come to my mind.”

SecurityInfoWatch: RILA survey: Retail crime on rise

“Some 72 percent of respondents said they have seen an increase in organized retail crime (ORC), and 52 percent said they had experienced a rise in financial fraud. Paul Jones, vice president of asset protection for RILA, noted that the increase in ORC should set off alarms not only within the retail community, but also within the business and law enforcement community. Organized retail crime typically involves organized groups of criminals operating shoplifting rings which have networks to fence their stolen goods, which may also appear on Internet auction sites like eBay, as well as at flea markets.”

Fast Company: Work/Life: “Secure Flight” Takes to the Air in August

“So now is the time to examine your driver’s license or passport to see that your first name, middle initial (if you use one), and last name appeared exactly the same across all of your identification. If you need a new photo for your driver’s license, now is the time to get it. Being consistent with your name also means that all of your bookings - including air, hotel, and car rental - must be consistent.”

SmartDataCollective: Enterprise Data World 2009

[Jim Harris] “Enterprise Data World is the business world’s most comprehensive vendor-neutral educational event about data and information management.  This year’s program was bigger than ever before, with more sessions, more case studies, and more can’t-miss content.”

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By the Infoglide Team

New York Times: Name Not on Our List? Change It, China Says

“By some estimates, 100 surnames cover 85 percent of China’s citizens. Laobaixing, or “old hundred names,” is a colloquial term for the masses. By contrast, 70,000 surnames cover 90 percent of Americans. The number of Chinese family names in use has tended to shrink as China’s population has grown, a winnowing of surnames that has occurred in many cultures over time.”

OCDQ Blog: All I Really Need To Know About Data Quality I Learned In Kindergarten

“When you present the business case for your data quality initiative to executive management and other corporate stakeholders, remember the lessons of show and tell.  Poor data quality is not a theoretical problem - it is a real business problem that negatively impacts the quality of decision critical enterprise information.”

BTNonline: Secure Flight Roils Booking Tech

“To facilitate the implementation of Secure Flight’s new data requirements for the travel industry, officials from the International Air Transport Association and Department of Homeland Security this year decided to use passenger data fields already used to transmit visa and passport information. TSA noted those IATA standards go into effect May 1.”

Security Systems News: Retail industry to ’speak with a single voice’

“There will now be a single entity both helping to establish best practices for loss prevention and lobbying state and federal government in regard to major security issues like organized retail crime.”

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[Post from Infoglide] Secure Flight and Identity Resolution

“Most of the time we’re just heads down doing our job of providing identity resolution solutions for our customers. But this is one of those weeks at Infoglide when we appreciate the opportunities we’ve had to make a difference. TSA announced that the Secure Flight Program has begun vetting passengers.”

[Post from Infoglide] TDWI Interview: Identity Resolution Reveals

“In a comprehensive discussion, Doug Wood of Infoglide Software spoke about an area of confusion that exists when people discuss identity resolution. He pointed out that the term is sometimes misapplied to describe software that performs data matching alone.”

data quality PRO: Identifying Duplicate Customers (Part 2)

[Jim Harris] “False negatives can be caused when the greater concern about false positives motivates a cautious approach to duplicate identification. This leads many projects to adopt a strategy allowing only exact matches. Therefore, let’s begin by looking for duplicates where the exact same information is repeated on multiple records – meaning where all attributes are populated and have the same value…”

TMCnet.com: Workers’ comp fraud rising: Task force to make unannounced visits

“‘The theory is that in a difficult economic climate, crime tends to go up as does fraud. People who aren’t otherwise motivated to be dishonest may follow that path,’ said Maureen O’Connell deputy district attorney with the fraud unit. The unit has seen a marked increase in workers’ compensation fraud over the past year and has had to double the fraud unit’s staff to handle the volume, she said.”

data quality PRO: External Reference Data - An Overview

“My guess is that exploiting external reference data as an important element in achieving optimal data quality will increase heavily in the following years, and cloud computing will be a main driver.”

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This post is based on a March 31 interview with Infoglide Senior Vice President Douglas Wood by Linda L. Briggs for TDWI (The Data Warehousing Institute), March 31, 2009. Click here to read the entire interview.

In a comprehensive discussion, Doug Wood of Infoglide Software spoke about an area of confusion that exists when people discuss identity resolution. He pointed out that the term is sometimes misapplied to describe software that performs data matching alone.

[An identity resolution engine is] software that allows organizations to connect disparate data sources in order to understand possible entity matches and non-obvious relationships. It boils down to this: Providing capabilities for organizations to understand “who’s who” and “who knows whom” across multiple data silos. Occasionally, when we introduce the concept of identity resolution technology to a new customer, their immediate response is “I see, but we already have a data matching engine.” The truth is, identity resolution engines have data matching at the core, but [they] provide much more functionality and flexibility than that.

So if identity resolution incorporates data matching, what really differentiates it from data matching products?

Perhaps the key element of an identity resolution engine is the ability to take the entity match and relationship results, then apply domain-specific rules to them. How does the enterprise treat Customer A by virtue of the fact that he or she has some non-obvious relationship with Customer B? The answer to that question is specific to the domain.

Most of us are familiar with the use of data matching for removing duplicates from databases and in cleansing input for data warehouses and master data management, but identity resolution is used in unique ways.

With identity resolution technology, data isn’t subjected to deterioration processes such as cleansing or record merging. Rather, the data can remain in its original state and in its original location.

What this means is that identity resolution is especially adept at uncovering risk, fraud, and conflicts of interest since the “forensic value of individual records is preserved for ongoing analysis.” While government is a key market for identity resolution engines, a growing number of commercial applications are emerging in financial services (e.g., PATRIOT Act compliance, detection of loan fraud and credit card fraud), retail (e.g., uncovering organized retail crime activities by comparing shoplifters with employees or frequent merchandise returners), workers compensation (e.g., finding employers that change attributes to avoid paying premiums), lottery corporations (e.g., compare winning ticket holders against lottery retail employees to discover potential fraud), and customer relationship management (e.g., keeping two similar records unmerged until birth date attribute uncovers a father/son relationship).

What prevents traditional data matching products from addressing these problems?

There are no problems with matching engines per se. They just aren’t identity resolution engines. Matching engines typically use one or two algorithms, perhaps mathematical in nature, that examine structured data looking for name matches. They provide an improvement over Soundex, but little more. What they do is say “Yes, this is a match” or “No, this is not a match.”

Common requirements for solving identity resolution problems include connecting to more diverse data types and formats, handling higher volumes, and delivering deeper insight into non-obvious relationships from existing uncleansed data sources.

If identity resolution engines have existed for years, what has caused the recent rush to employ them?

As part of the 9/11 Commission recommendations, the Department of Homeland Security began a robust search for identity resolution technology that could keep terrorists off airplanes by comparing passenger attributes against terrorist watch lists, no-fly lists, and other types of threat-related data. Through a few iterations, the selection and implementation process evolved into the Transportation Security Administration’s (TSA) Secure Flight Program, which ultimately thrust identity resolution technology into the limelight. Secure Flight is now widely recognized as the pre-eminent use case for identity resolution technology requirements today, and a number of companies are involved in delivering that solution.

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By the Infoglide Team

Background Now: AG Seeks Injunction Against Contractors Asset Protection Association, Inc. (ConAPA) and Eugene Magre

“‘This company falsely promised its clients that if they gave their employees empty titles and worthless shares of stock they could avoid tens of thousands of dollars in workers compensation premiums,’ Attorney General Brown said. ‘But you can’t simply call a security guard a vice president and avoid complying with the law through a sophisticated and fraudulent scheme.’”

DailyTech: New Bills Target Stolen Merchandise Sold Online

“Under the new legislation, the brick and mortar retailers would score a major coup in that they could order eBay.com, Overstock.com, and Amazon.com to remove numerous goods without any proof.  Under the proposed laws, failure by the online retailers to ‘expeditiously investigate’ and remove the items would result in criminal penalties.”

BeyeNetwork: Business Drivers and Master Data

“Is the actual business need for a single version of the data, or just multiple versions, each of which is of higher quality? Drill down into this a little bit and you may need additional information from your business customers. What constitutes a requirement for master data? A situation in which two business processes need to have a fully shared view of the same representation of a data item?”

Web of Data: Report on Data Discovery by Bloor Research

“…there are now a number of products on the market that can discover data relationships that do not fall within the category of either data profiling or data quality. As a result, it is time to consider the importance of data discovery, and its requirements, as a market in its own right.”

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[Post from Infoglide] The Human Element in Identity Resolution

We’ve written quite a few posts here on the subject of identity resolution’s application to a broad range of problems that include terrorism, insurance fraud, crime, lottery fraud, sexual predators, workers comp employer fraud, and retail returns fraud. What we haven’t discussed very much is the relationship between the technology and the human beings that employ it.

Boston Globe: Woman to be sentenced in asbestos case

“Deleon ‘cheated the system’ in two ways to enrich herself, according to the government’s case. Under her ownership, Environmental Compliance Training issued false asbestos removal training certificates and lied about it to the state. She also evaded payroll taxes and workers’ compensation insurance premiums by paying hundreds of employees of Methuen Abatement Staffing under the table. The company had a gross unreported payroll of $4.6 million from 2002 to 2006, according to a government document introduced at the trial.”

New Mexico Independent: Homeland security ‘fusion centers’ are working, but concerns abound

“The federal assessment of the nation’s fusion centers — which borrows heavily from earlier reports by such internal watchdogs as the Congressional Research Service (CRS) and General Accountability Office (GAO) — lists a few privacy, transparency and oversight concerns about the fusion centers.

Wall Street Journal: Tips for TSA to Make Flying Safer, Easier

“Some experts suggest that the TSA cut back on the air marshal program, which puts law-enforcement agents on some flights, and shift spending to more effective security measures. Experts also want to see major changes in the current Registered Traveler program to further speed up security procedures for frequent travelers and focus resources on travelers who haven’t undergone background checks. They also want to see more variation to today’s predictable screening so bad guys don’t know exactly how to circumvent security.”

Gartner: Can “single view” of master data be achieved without an MDM technology?

[Andrew White] “Certainly users have been trying to achieve ’single view’ for many years, before the phrase master data management was coined.  The problem of trying to maintain a semantically consistent definition of master data across the business has been a long standing desire for most firms.  It is because business (and to a great extend, IT also) has grown to be so complex, that since 2000 many firms have begun to look to specific tools to help.”

WorkersCompensation.com: Chenango Man Charged As Fraud In Fish Story

“Investigators from NYSIF’s Division of Confidential Investigations said Mr. Panus was receiving workers’ compensation payments for a work-related back injury that occurred in 1988. The investigation, conducted in cooperation with the New York State Insurance Department Frauds Bureau and the Office of the Workers’ Compensation Fraud Inspector General, found that Mr. Panus was allegedly self-employed as the owner of Ponderosa Fish Farm while receiving benefits totaling $66,100.”

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