This Christmas is predicted to be the most fraudulent ever.
That’s according to the Barclays Digisafe Christmas survey, which estimates the total loss to victims of fraud will reach £1.3 billion this festive season. The average loss per person is £893.
It’s not exactly what this time of year is supposed to be about. But in our efforts to shower our friends and family with gifts, we’re increasingly opening ourselves up to fraud. Rock bottom prices, access to an expansive marketplace and our increasingly time-poor lifestyles are fueling unprecedented levels of online shopping at Christmas time.
For fraudsters, it’s feeding time at the watering hole. For most of the year we’re cautious about where we buy from; normally sussing out the legitimacy of a website before we give up our bank details. As Christmas creeps up on us we become more desperate and more lax. We take risks on lesser known sites to save a bit of cash, or make sure ‘that present’ is under the tree. More than half of the people surveyed by Barclays (52%) admitted that the lure of a bargain can stop them from checking a site’s security credentials.
It isn’t just websites that are the issue either. Many of us will buy gifts from individual sellers on online marketplaces this Christmas. And why not? Auction sites can be great places to find bargains. The issue is, they’re also hotbeds for criminals. As much as 65% of all reports to Action Fraud last year related to online marketplaces and auction sites.
The reason bidding and classified ad sites are so popular is because there are virtually no barriers to signing up and selling. The sites themselves do not perform any checks on sellers; they rely on community members to rate and review the people they buy from. The problem is, you can’t always trust the reviews and ratings on a seller’s profile.
Earlier this year, Citizens Advice Bureau issued warnings about scammers writing fake reviews to make their own selling profiles appear reputable. The organisation’s report found that people were more likely to fall victim to ‘phantom scams’ than any other con or dodgy investment scheme. A phantom scam involves handing over money to an online seller when there is in fact no item to be bought in the first place. On average, people are said to lose £1,100 to phantoms scams.
What’s frustrating is that phantom scams, and indeed other similar scams, are so easily avoided. The technology already exists for two individuals—a buyer and a seller—to swap verified identity details before making a transaction. Confident that the buyer knows who the seller is, and with a digital receipt to prove the swap was conducted, the buyer can be quite sure that the person they’re dealing with is not a scammer. After all, why would a scammer conduct fraudulent activity when their government issued passport or driving licence is pinned to the crime?
One of the Yoti app’s earliest functionalities was Swap. The simple act of swapping checked and verified identity details like name, date of birth, address and a photo of someone’s face, is, at its core, what Yoti is all about. A site doesn’t even need to be integrated with Yoti for people to buy or sell confidently on its platform. Yoti puts the power to sniff out scammers from genuine sellers in the hands—or the phone, more specifically—of the user.
Here’s how it works. Lucy wants to buy a guitar she saw on Gumtree as a gift for her boyfriend. She messages Andy, who is the owner of the guitar. Lucy asks Andy if he wouldn’t mind swapping details with Yoti so she can be sure he isn’t a scammer. Andy agrees to.
Lucy downloads the free Yoti app and starts to create her Yoti account. She uploads a photo of herself, verifies her phone number using a verification code sent to her phone, scans a government photo ID, like a passport or driving licence, then she completes a liveness test—recording herself saying three randomly generated words—to prove it’s really her.
These processes are imperative to ensuring people with Yotis are the rightful owners of them. All documents uploaded to Yoti are checked by a trained team in a secure ‘cleanroom’ to stop people from creating fake Yoti accounts.
So, Lucy’s Yoti is set up and verified. She’s good to go. All she has to do now is choose how she wants to swap details with Andy: text message, email, face to face or via a link. Let’s say that this time Lucy chooses text message. Andy receives a text message from Lucy requesting to swap details with Yoti. If Andy doesn’t already have Yoti then he’s asked to download and create Yoti to complete the request.
Andy’s Yoti is all set up and he can accept Lucy’s swap request. Both Andy and Lucy receive the personal details they requested from each other and Lucy is assured that Andy is indeed who he claims to be. Happy days.
This Christmas will be the most fraudulent. But next Christmas, and the Christmas after it, don’t have to be. With verified digital identities, Yoti or otherwise, we can make buying from online marketplaces and auction sites safer for everyone.