Loading...

Electronic Signatures and layered authentication

Published: December 7, 2015 by Bill Sallurday

Electronic signatures and their emerging presence in our Internet-connected world

esralogoI had the opportunity to represent Experian at the eSignRecords 2015 conference in New York City last week. The concept of electronic signature, while not new, certainly has an emerging presence in the Internet-connected world — as evidenced by the various attendee companies that were represented, everything from home mortgages to automobiles.

Much of the discussion focused on the legal aspects of accepting an electronic signature in lieu of an in-person physical signature. The implications of accepting this virtual stamp of approval were discussed, as well as the various cases that already have been tried in court. Of course, the outcome of those cases shapes the future of how to properly integrate this new form of authorization into existing business processes.

Attendees discussed the basic concept of simply accepting a signature on an electronic pad as opposed to one written on a piece of paper. That act alone has many legal challenges even though it provides the luxury of in-person authentication through a face-to-face meeting.

The complexities and risk increase exponentially when these services are extended over the Internet. The ability to sign documents virtually opens up a whole new world of business opportunities, and the concept certainly caters to the consumer’s need for convenience. However, the anonymity of the Internet presents the everyday challenge of balancing consumer expectations of greater ease of use with necessary fraud prevention measures. Ultimately, it always comes back to understanding who is actually signing that document.

All of this highlights the need for robust authentication and security measures. As more and more legal documents and contracts are passed around virtually, the opportunity to properly screen and verify who has access to the documents gets more critical.

Many organizations still rely on the tried-and-true method of knowledge-based authentication (KBA), while many others have called for its end. KBA continues to soldier on as an effective way to ensure that people on the other end of the wire are who they say they are by asking questions that — presumably — only they know the answers to.

In most cases, KBA is viewed as a “check the box” step in the process to satisfy the lawyers. In certain cases, that’s all you need to do to ensure compliance with legal policy or regulatory requirements.

It starts to get tricky is when there’s more on the line than just “check the box” actions. When the liability of first- or third-party fraud, becomes greater than simple compliance, it’s time to implement tighter security, while at the same time limiting the amount of friction caused by the process.

Many in attendance discussed the need for layers of authentication based on the type of documents that are being processed and handled. This speaks directly to the point that one size does not fit all.

As the industry matures and acceptance of e-signatures increases, so too does the need for more robust, flexible options in authentication.

Another topic — that was quite frankly foreign to everyone we talked to — was the need for security around the concept of account takeover. When discussing this type of fraud, most attendees did not even consider this to be a hole in their strategy.

Consider this fictional scenario. I’m responsible for mergers and acquisitions for my publicly traded company. I often share confidential information via electronic means, leveraging one of the many electronic signature solutions on the market. I become a victim of a phishing attack and unknowingly provide my login credentials to the fraudster. The fraudster now has access to every electronic document that I have shared with various organizations — most of which have been targets for mergers and acquisitions.

Fraudsters are creative. They exploit new technologies — not because they’re trendsetters, but because oftentimes these new technologies fail to consider how fraudsters can benefit from the system.

If you are considering adopting e-signature as a formal process, please consider implementing:

If you haven’t considered implementing e-signature technology into your business process, you should — but be sure to have your fraud team present when considering the implementation.

Related Posts

...

Published: June 6, 2023 by admin

According to Experian data analysis and a recent study on unemployment insurance fraud, at least 25% of new claims are a result of identity theft.

Published: April 15, 2021 by Eric Thompson

It’s critical for credit unions to understand the specific threats presented by life online and be prepared with a fraud detection and prevention plan

Published: April 13, 2021 by Alison Kray

Subscription title for insights blog

Description for the insights blog here

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Categories title

Lorem Ipsum is simply dummy text of the printing and typesetting industry. Lorem Ipsum has been the industry's standard dummy text ever since the 1500s, when an unknown printer took a galley of type and scrambled it to make a type specimen book.

Subscription title 2

Description here
Subscribe Now

Text legacy

Contrary to popular belief, Lorem Ipsum is not simply random text. It has roots in a piece of classical Latin literature from 45 BC, making it over 2000 years old. Richard McClintock, a Latin professor at Hampden-Sydney College in Virginia, looked up one of the more obscure Latin words, consectetur, from a Lorem Ipsum passage, and going through the cites of the word in classical literature, discovered the undoubtable source.

recent post

Learn More Image