London, UK, 01 June 2017: Consumers are falling prey to the growing risk of phone fraud. A new study warns that criminals can use information found on social media profiles to answer weak security questions, posed by banks, to gain access to accounts. This highlights the security flaws that exist within contact centres, and the need to improve security on the phone channel, a channel that has long been neglected.
Responses to an independent survey of 3,000 consumers in the U.K., France and Germany indicate a similar trend across each country – nearly two thirds of consumers have shared answers to security questions on their social media channels. Respondents also proved to be frustrated with current authentication methods, especially in the phone channel. Around half of respondents regularly contact service providers at least once a month by phone. Over two thirds (45%) admit to forgetting the answers to security questions when they call their bank or utility company, while 48% believe that too many companies ask the same questions to authenticate.
“It would appear that fraudsters are taking advantage of consumers’ unassuming habit of sharing personal details on their social media profiles,” said Matt Peachey, Vice President of International at Pindrop, a voice security and authentication company. “These consumers are exposing themselves to significant risk, as fraudsters can use these details to successfully pass security questions over the phone. In fact, financial institutions report that 61% of their fraud cases touch the phone channel.”
The issue is much more extreme amongst 18-24 year olds where 80% confirmed that they have at least one piece of information on social profiles that is used for personal verification, including date or place of birth. According to Peachey, “The lines of defence across online and offline security must be connected; both by consumers and by banks and utilities companies.”
The study found that consumers seriously underestimate the potential for fraudsters to use the phone channel to take over their accounts. While 64% of respondents feared their accounts being hacked online, only 55% were afraid of fraudsters being able to gain access to their accounts over the phone. In addition, consumers did not understand how fraudsters are leveraging personal data. Just 8% of consumers agreed that they had a high level of knowledge about where and how their personal data is used. Compared to 12 months ago, one in four consumers feels less confident that their personal information is being suitably protected.
“The survey found that 57% of all respondents called their bank within the last month, so the challenge these organisations face is how to continue to offer exceptional customer service over the phone without neglecting security,” said Peachey.
One solution that many organisations may consider is voice biometrics. These technologies often claim to eliminate the need for consumers to remember passwords, a benefit that 42% of respondents preferred. However, while 39% of consumers would likely sign up for the option to use voice as a password if offered, only 10% of consumers, across each of the regions surveyed, express high levels of confidence that voice biometric authentication is a secure approach.
“Following recent news that voice biometrics can be easily hacked, it’s clear that using just your voice as your password is not enough,” said Peachey. “To better tackle fraud attacks on the phone channel, organisations require a multilayered form of defence. The solution must analyze voice as well as the audio and network characteristics of the call itself.”
This can be accomplished using Phoneprinting™ technology, available from Pindrop, which analyses 147 unique characteristics of the background audio of a call. This analysis provides the true geographical location of the caller, the device being used and whether the device has been used to contact the company before, to build a far more reliable verification of a call and a more resilient form of defence than using voice biometrics alone.
This study was commissioned by Pindrop® Labs and conducted by Loudhouse, a London-based independent research agency surveyed 3000 consumers across U.K., France and Germany, in April 2017.
NOTES TO EDITORS
Chart 1- Q: Which of the following types of questions have you used to help confirm your identity over the phone?
Chart 2 – Q: Which of the answers to these security questions are available on your social media pages eg. Facebook or LinkedIn – whether or not it is shared publicly?
 Contact Centers: The Fraud Enablement Channel, Aite Group, April 2016
Pindrop® solutions are leading the way to the future of voice by establishing the standard for security, identity, and trust for every voice interaction. Pindrop® solutions protect some of the biggest banks, insurers, and retailers in the world using patented technology that extracts an unrivaled amount of intelligence from every call encountered. Pindrop® solutions help detect fraudsters and authenticate callers, reducing fraud and operational costs, while improving customer experience and protecting brand reputation. Pindrop, a privately held company, headquartered in Atlanta, GA, was founded in 2011 and is venture-backed by Andreessen Horowitz, Citi Ventures, Felicis Ventures, CapitalG, GV, and IVP. For more information, please visit pindrop.com.
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