Knowledge Based Authentication as an effective tool in your Identity Theft Protection Program

April 2, 2009 by Keir Breitenfeld

I’ve previously posted content around an overall risk-based approach to Red Flags compliance. I also want to keep current in mentioning the use of Knowledge Based Authentication (KBA) as an effective component in an Identity Theft Prevention Program. I get this question often: "Is KBA a fraud detection tool or a verification tool?" Short answer: "It’s both."

Beyond fraud detection and prevention, KBA implementation can provide your program real returns in a few key areas:

Reconciliation of initially detected "Red Flag" conditions
KBA allows you to positively pass consumers who may have some level of initial authentication challenge or high-risk condition. The reality of identity verification is that regardless of all the data assets potentially leveraged, there are still those cases in which a good consumer identity continues to pose challenges to basic verification checks.

Cost reduction in referral / reconciliation processes
KBA can replace more subjective decision making and process invocation, turning instead to objective question presentation and performance to drive overall decisioning.

Customer experience
Consumers are more willing today than ever before to participate in a KBA session, and most would prefer this activity over provision of documentary evidence, for example.

KBA, when used in combination with strong analytics and comprehensive authentication results, can be valued tool in your overall Red Flags Identity Theft Prevention program.