The digital landscape has transformed dramatically in recent years, and with it, the sophistication of identity fraud has grown. Deepfakes, forged documents, and advanced impersonation techniques are becoming alarmingly common, and criminals use them for fraudulent attacks on both consumers and institutions. The US Federal Trade Commission estimates consumer losses from fraud at $12.5 billion in 2024, a 25% increase from the previous year.
Banks and other financial institutions have no choice but to move beyond single-layer defenses. Today, security must be multi-layered—like the walls and ditches of an ancient fortress—each one reinforcing the next to ensure both customers and institutions remain protected.
At the heart of this defense strategy lies robust identification. Strong ID verification solutions remain among the most effective ways to detect and block fraudulent activity. Once doubtlessly identified, users can use electronic signatures. A qualified electronic signature (QES), which under EU law is equivalent to a handwritten signature in almost all respects, forms the basis for legally secure digital documents that cannot be altered after signing. To create the signature, a hash of the original document is used. If the document were manipulated, this value would change, rendering the signature invalid. QES can be smoothly integrated into various financial processes, ensuring document authenticity and legal compliance.
However, aside from forged documents, there are many more potential attack vectors, making additional safeguards essential. One powerful tool is device fingerprinting, which analyzes more than 200 device attributes to build a unique digital "fingerprint." This enables financial platforms to spot irregular patterns—such as multiple identities using the same device or login attempts from inconsistent locations—and take action before damage is done. Suspicious devices can be flagged early and blocked across various platforms, preventing fraudsters from refining their tactics through trial and error.
Beyond device analysis, contextual data plays a vital role in uncovering deception. Information like geolocation, VPN usage, or proxy connections can reveal inconsistencies that human review might miss. For example, if an account application claims to come from Europe but the associated device pings from Asia, the system can immediately trigger a red flag. By cross-checking declared data with these technical signals, financial institutions add yet another crucial layer of protection.
Ultimately, protecting against fraud requires more than technology; it also depends on collaboration. Financial institutions, trust service providers, platform developers, and regulatory authorities must work together to share insights, tools, and data. By pooling information on suspicious identifiers —such as fraudulent phone numbers, email addresses, or digital identities —these stakeholders can build a collective intelligence network that significantly improves fraud detection. When one sector spots a threat, that knowledge can help protect others, whether in online retail, banking, or beyond. In an era of increasingly complex cybercrime, only through shared vigilance can we stay one step ahead of fraudsters.
Would you like to learn more about digital trust ecosystems within the financial sector? Download our latest white paper, which we created in collaboration with mesoneer, a Swisscom partner and platform provider for finance companies.