15 minute read
Nowhere to hide
Garient Evans, VP of Identity Solutions for Trulioo, says the global identity verification company will ‘turn over every rock’ when it comes to data transparency and holding the most powerful to account
The shady dealings of the rich and powerful revealed in the so-called ‘Pandora Papers’ rocked the world in October 2021.
Published by the Washington DC-based not-for-profit International Consortium of Investigative Journalists (ICIJ), the papers comprise of more than 11 million documents that reveal the tax-sheltering offshore deals and assets of more than 100 billionaires and 300 public officials – from former UK prime ministers to past US presidents – and the companies set up to facilitate them.
It followed similar revelations in the Panama Papers and the Paradise Papers, published in 2016 and 2017 respectively, but the latest cache of 2.94 terabytes of information, centred on 14 offshore advisors and service providers, make Pandora the biggest exposure yet.
Crunching this volume of data was no mean feat for the journalists from 117 countries who collaborated to crack it, including those from major outlets, including BBC Panorama, the Washington Post, the Australian Broadcasting Corporation and Le Monde in France.
They unveiled an unsavoury sign of our times – made all the more unpalatable, perhaps, by the fact such practices are taking place as the world at large is struggling to get back on its feet after one know their suppliers, their merchants, their business. We call it know your business (KYB), and we think [the need for that] is a trend confirmed by the Pandora Papers. It shows there is a need for services that can provide this type of transparency, and we’re excited to be able to offer that.
“So, if you’re a global financial institution, or a marketplace, and you have to know what businesses you’re dealing with, who the owners are and whether or not they’re on a financial sanctions or designated persons list for terrorist financing or money laundering, we can help.”
Dramatically increasing the number of worldwide data sources that Trulioo can draw upon is key to enabling this.
“We’re embracing the challenge our CEO gave us: to double our data sources, in terms of the amount of countries and the depth of coverage we have,” Evans continues. “We are turning over every rock to identify high-quality sources around the world, to offer them back to our customers.
“We’ve learned that even the largest global players need quick, convenient, secure access to data sources, particularly from emerging markets where they could go to procure their own data from authoritative sources, like credit bureaus, government registries and utilities. However, they find it faster, cheaper and more reliable to come to Trulioo, because we’ve already prenegotiated the arrangements, implemented them, standardised them, and made sure they’re robust enough to provide quality identity verification solutions in these high-growth markets.”
Bringing emerging markets into the fold is not only commercially attractive. It's also essential to Trulioo’s goals of increasing financial inclusion and transparency, and helping to prevent fraud.
of the most serious pandemics in history.
Breaking as it did, during such a fragile geo-political operating environment, most of us have reacted with outrage to the scandal. It also caught the eye of experts at Canadian-headquartered identity verification (IDV) company, Trulioo.
Founded with the ambition to promote data transparency and see everyone in the world able to access a digital identity so that they can have equal opportunities in life, Trulioo sees revelations such as the Pandora Papers as confirmation of the justice in its mission to level up.
It’s now turning its data spotlight on the shadows where unethical companies and individuals have, until now, been able to hide from their fiscal responsibilities. Imagine if the wealth of information, worldwide, were so rich, and so well-understood, that there were no hiding places left for journalists like the ICIJ’s to unearth.
Trulioo’s senior VP of identity solutions, Garient Evans, says the company plans to double its own data sources, coupled with highly sophisticated ways of making sense of them. The aim is full transparency, enabling companies to do business, governments to maintain tax regimes and national security, and individuals to manage their finances, in full knowledge of what and who they’re dealing with.
“Our business verification can get to the ultimate beneficial owner of a shell company that is trying to hide assets, which meets our mission of not only identifying individuals but also helping companies that want to do business with other corporations,” Evans explains.
“We want to shed light on different corporations and their movements around the world, to help companies
“If you want data sources in the US, you have many, many options and, in some cases, they may not be very differentiated, so you’re competing on price, or whether you can bundle in a lot of sources,” says Evans.
“In emerging markets, millions of individuals have never been able to participate in the digital ecosystem, but many of them have a phone, are accessing local utilities, or may be on a government registration scheme that we can utilise. We can use these to start providing these individuals with their first-ever digital experience for access to products and services. Then we can make that more convenient for the next service provider.”
Evans describes the process Trulioo employs, and why ensuring the best possible match rate is so vital to removing reasonable doubt from the results generated for each individual or company: “If you’ve ever switched phones, email addresses or phone numbers, and had to port your contacts and merge them with another list, you realise just how hard it is to manage just the people in your own life. Imagine doing this on 10, 100 or 1,000-times the scale, dealing with millions of identities and trying to figure out if they’re unique – considering how many people share an address, phone number or email address – as well recognising nicknames and appreciating regional differences.
By way of explanation, Evans says: “I was born in South America, I have three last names on my birth certificate and, if I use my official passport from Colombia, it also shows multiple last names. But I grew up in the United States, and there I just have one. My name is Welsh and has different spellings; my hippy parents spelled my name differently to the traditional Welsh spelling. Should I be rejected because it can’t be matched, or can there be a tolerance for that unique spelling?
“What that illustrates is that identity, and the process of matching it, is really complex and most companies can’t do it themselves, at scale, because it’s not good enough to take a local approach that might work in the UK, in Canada or the US, and assume that will be appropriate for matching identities in, for example, Dubai, Argentina or Ethiopia. And there are also lots of regional differences.
“Not everybody uses the Roman language and Roman characters, for a start. Then there are regional accents and tildes, and whether they should be included or not. How many last names are appropriate? Or double first names? Trulioo takes all these things into account when we match and standardise.”
Adding to this complexity is the fact that the people the data relates to are increasingly mobile, often, like Evans, growing up in one place and moving to another. And, as the Pandora Papers have shown, those who have the means, often deliberately operate in different jurisdictions, meaning firms must cater for this increasingly-borderless world.
“We recognise that names can change – people have nicknames, might get married, might hyphenate. While a date of birth and national identifier should be a static, one-to-one relationship, there are many, many relationships in terms of address, phone number, email; you could have many people associated with the same phone number, and many phone numbers. But we can account for that complexity, working with partners that have the depth of information, can look at the history and help us determine the most recent and relevant data for each person.”
Quite apart from compliance and fraud prevention, having the right parameters in place is a commercial imperative for Trulioo’s clients to achieve slick onboarding.
“There are good and bad matches, and false positives. Look for Garient Evans in the United States and, if you find me, you’ll probably get a true positive; there is only one Garient Evans there, I’m happy to say! But in Wales, there are several, so you might match my identity information with the wrong individual. That won’t meet your compliance requirements as a financial institution, and you might run foul of fraud. So, we test and control, using a very scientific method.
“We look at data sources and determine their strength, and how often they are producing false positives or negatives, which means you think you don’t have a match when it should have been and, as a consequence, that person cannot onboard. We monitor these things with our clients to determine the quality of our data sources, and matching logic, then proactively go back to them and say ‘we have a better data source for you. We’ve been testing it, we’re getting better results and we recommend you switch to it’. That’s why doubling the number of our data sources is so important, because we are consistently finding better
So, what does good look like when it comes to match rates?
“It differs globally and, in the most developed markets, with different data options, you’re going to see 70, 80, 90 per cent being the standards for match rates,” says Evans. “But some developing markets that have a digital presence, like Eastern Europe and parts of South America, where there’s been a substantial digital onboarding presence for a while, will also have match rates in the seventies. Three-quarters of folks there can get identified, and the key to that is mobile. Mobile access, especially the proliferation of smartphones, means people can open a bank account and start having a footprint.”
Evans is particularly excited about opportunities surrounding the traditionally underserved business sector.
“A very exciting trend, which has accelerated because of the pandemic, is small businesses having their first digital experience,” he says. “Folks who were working in face-to-face settings had to
We continually have new data sources giving new insights. After all, who hasn’t gone through some type of change in the last two years?… Some corporations have done away with their offices
options to help our clients upgrade easily.”
Then comes the issue of maintaining the data effectively and compliantly – in terms of updating, cleansing and storing it.
“Many clients take advantage of the ability to batch up their datasets and send them back to Trulioo, because we continually have new data sources giving new insights. After all, who hasn’t gone through some type of change in the last two years? A new address, new job, perhaps they no longer have a corporate physical address, as some corporations have done away with their offices.
Quite a bit of contact information will have changed in the last few years and it’s not good enough for financial institutions to rely on old data.” find another way to put food on the table. Some are teaching courses online, creating content they can sell in a digital marketplace or customised goods to sell abroad, and we’ve seen a corresponding growth in requests for business verification within these small businesses, to be able to explain who the ultimate beneficial owner of that business is and do additional ID verification on them.
“Our mission is to give individuals access to digital experiences, not just to consume but also to work in a global way because markets are no longer limited by proximity.”
But opening this particular Pandora’s Box of data collection and management requires cooperation by regulators in different geographies, says Evans.
“Regulators and legislators in certain markets have yet to define what is appropriate. This stalls a country in making that data accessible, and entrepreneurs from collating, cleansing, standardising and making it available for third parties to use and consume. There are so many markets that have yet to adopt some of the privacy and legislative advances you see in Europe, like the General Data Protection Regulation (GDPR), and, until the legislators weigh in and describe what’s permissible and what’s restricted, they have effectively frozen out solution providers and denied access to products and services to millions of people.
“We really encourage governments to adopt best practices and standards, so that participants can offer high-quality solutions to enable commerce.”
As embedded or contextual finance are enabled by technology, and new business models emerge, the lines between non-financial services and financial service companies are blurred, continues Evans. That has an impact on the KYC they are required to perform.
“Taxi services now deliver food and provide various transportation services, including the ability to lease, or even borrow money to buy, a car. The largest e-commerce retailer is now providing merchant loans to allow merchants to stay afloat and purchase more supplies. These are now financial service companies which means that, while they may never have seen themselves as financial service providers, they are now subject to some of the same regulations as the traditional ones, regarding fraud, money laundering and terrorist financing.”
All of which makes Trulioo’s potential marketplace both limitless and borderless.
“Most marketplaces experience demand from suppliers and consumers of their products and services around the world, so onboarding has to be borderless,” says Evans.
“In certain jurisdictions, address is one of the most important factors for ID verification, while, elsewhere, an email address could be an important point of identity, or a phone number. We keep an eye on what regulators are telling us and incorporate this into how we source data and do our matching, to keep our clients compliant.”
Trulioo also guides institutions on data nuances such as risk tolerance.
“We have conversations with clients about the range of regulatory approval delivery from their favourite local restaurant their auditor is telling them is acceptable. and conducting their entire financial lives So, with nicknames, for instance, a strict online. So, we’ve continued to see matching posture will only accept companies coming to us that are launching ‘Jonathan Smith’ as a direct match. But, with new digital initiatives, to offer their products tolerance, you can accept matches with the and services more conveniently online. ‘Jon’, ‘Jonny’ or ‘J’ derivations of that name to “There are businesses that no longer exist, create a more convenient onboarding as a consequence of the pandemic, which experience for somebody who’s gone as is very unfortunate but has answered the ‘Jon Smith’ their whole life but their question about whether or not companies documentation shows ‘Jonathan Smith’. can persist, not being technologically-
“We discuss this with clients and test enabled and connected to digital what their match rates are with higher experiences. I think maybe those that never tolerance – what we call fuzzy matching invested, decided not to accommodate – like nicknames or one-time errors, such as remote access to products and services, the transposition of numbers in a phone didn’t survive. Because consumers are number, which is off by just one digit. And, finding the new way of doing things so in regimes that require strict matching, we convenient, they’re deciding to stay with it. can also show what the repercussions of “Institutions that have had success in a that are for onboarding.” single market are also now saying ‘we think
It’s hardly surprising, given the we have an audience in multiple markets pandemic-fuelled growth in digital and want to expand to new territories’. interactions, that Trulioo has been on a Instead of coming up with identity solution dramatic upward trajectory since a providers in each of those regions, they’ve successful funding round in June 2021. This heard how, over the last 10 years, we’ve year, it was also listed among Canada’s 100 developed the data sources to conveniently fastest-growing companies (503 per cent and securely identify folks in each of these a year), and included in the Narwhal List territories, and are deciding it’s easier to of successfully-scaling work with us.” private enterprises. All of this means that
Its $394million Series those companies still in D funding round, led by the game will have to growth equity firm TCV continually up the ante with participation from in terms of their online existing investors, customer service. increased Trulioo’s “A decade ago, the valuation to $1.75billion largest e-commerce and gave it the capital to retailer gave us the accelerate its goal of one-click shopping becoming an end-to-end experience. You could identity platform. By the buy anything you close of this year, the size wanted with one click, of its overall workforce and that has set the will have increased two-fold, with new bar for everybody else. How do we match offices established in Austin, Texas and that digital experience with safety and San Diego, specialising in developments convenience, to create trust that customers such as artificial intelligence and machine will get the product and service on time, learning. With a current, 260-strong and that the data they provide will be held workforce distributed across Canada, responsibly?” says Evans. “Everybody who’s the States and Ireland, it plans to add working online is trying to replicate that an additional office, in Asia, in 2022. super-convenient and safe experience.”
The demand it’s experiencing is a Whether you’re one of those retailers, reflection of macroeconomic conditions, onboarding a single consumer in a distant continues Evans. market, or a corporate that wants to be
“Activities people might’ve been willing to confident it’s dealing with a counterparty do face-to-face, before the pandemic, have that’s not flying close to the moral been driven online, from opening accounts wind, it’s useful to have a transparency to ordering their groceries or meals for trail-blazer like Trulioo on your side.
