October 30 2023
Picture this: A fraudster hacks into the email account of a high-net-worth individual (HNWI). The fraudster then contacts the individual’s wealth management company and requests funds to be moved into a new account. Because the request is coming from the client’s email, an employee at the wealth management firm approves it. The fraudster escapes with the stolen funds.
The wealth management sector needs utmost security: because they deal with ultra-high-net-worth and high-net-worth individuals, the financial gain from defrauding a wealth management account can be huge.
In this highly regulated industry dealing with high value assets, a robust solution is essential to secure online onboarding and authentication. Biometric face verification enables wealth management organizations to prove an individual’s identity when they access services remotely, without inconveniencing the user in any way. The right solution should be secure, convenient, and easy to use.
For private banks and relationship managers, the importance of verifying the genuine presence of an online client has never been higher.
For such a high-risk sector, single-factor authentication simply isn’t secure. It’s easy for a shrewd fraudster to get past it. Passwords are weak and only fit for purpose as part of a wider multi-factor authentication (MFA) strategy, and social engineering attacks are rife. Plus, technology has made brute force attacks easier than ever.
In addition, there is a unique complexity to financial affairs in this industry, which increases opportunities for fraud. Private banks and wealth management companies can carry out a wide range of financial services for HNWIs and their families, including retail banking, investment management, tax affairs, estate planning, and legal matters. Establishing trust in this context is complex but essential.
Criminals target wealth management firms’ clients because:
iProov works with wealth management firms to securely verify and onboard new clients, securely authenticate account/portal sign-in, and authorize high-risk transactions using advanced biometric face verification technology.
The face is essential because it facilitates matching a unique biometric characteristic against a trusted identity document (such as a driver’s license) in order to establish genuine identity. Meanwhile, robust liveness technology works to ensure an online user is a real person, detecting if the face being presented to the camera is a live human being.
This minimizes many threat vectors by ensuring that only those verified and authorized can access or manage the HNWI’s account. Once verified, payments or other transactions can be authorized with a brief, effortless facial scan. HNWIs can use any device with a user-facing camera to authenticate. There are no complicated instructions or steps to follow. It’s simple, yet delivers the highest levels of security.
iProov also allows clients to effortlessly recover their identity if a device is lost, stolen, or replaced. This can often be a tedious and insecure process without iProov, as clients would have to reverify their identity to the organization (often requiring sending physical documents!)
Not all liveness technology is created equal. As wealth management is such a high-risk environment, only iProov’s most mission-critical solution is recommended to enable an organization to be sure that the remote user is the right person, a real person, and that they’re authenticating right now.
1. Building and maintaining customer trust
For private banking and wealth management firms, establishing and maintaining trust with clients is vital. It ensures that the firm wins the client’s business in the first place, and that the business is retained.
Wealth managers typically have strong personal relationships with their customers, and in-person visits are common. However, HMWIs want and need digital access. According to McKinsey, 71 percent of private banking clients prefer multi-channel interaction, and 25 percent want a fully digitally enabled private banking journey (with remote human help if needed).
iProov’s technology enables wealth management firms to demonstrate to their clients that they are using the gold standard in online security and user experience. This builds initial trust and retains it through secure, effortless authentication that does not inconvenience the client.
2. Avoiding reputational risk
Wealth management firms depend on their reputations. A security issue with one client can not only jeopardize that particular relationship, but can impact current and future business.
3. Adding value to customer service
Private banks and wealth managers often use ‘callbacks’ to maintain security and to demonstrate a responsive and personal service to their clients. This means that transactions are validated via a callback either from a call center team or by the relationship manager. This is a common point of friction between wealth management firms and their customers: “I’m busy/in a meeting/I can’t talk now so just go ahead etc…”. It’s also a weak link in the security chain: a fraudster could manipulate this process if they’ve intercepted a user’s mobile.
iProov helps add value to the customer service process by:
4. Delivering effortless user experience and accessibility for all clients
Each HNWI will expect a level of service that meets their individual needs. Some HNWIs will be technically advanced and want to engage with their wealth managers on multiple devices — smartphones, tablets, and laptops. Others may not even own a smartphone.
iProov offers a consistent, effortless user experience across all devices which…
5. Protecting against fraud
As discussed above, HNWIs and wealth management firms are a target for fraudsters as the returns can be big if a scam succeeds. iProov can help to protect against fraud, so that money is not stolen and a bank’s reputation is protected. Fraud attacks can include:
Criminals use a variety of tactics to steal money and cause disruption. These include malware, digitally injected attacks and the use of deepfakes. iProov is unique in being able to detect and mitigate against the use of synthetic imagery, such as deepfakes or face swaps, in attacks.
Ultimately, a strong biometric solution can deliver unrivaled security for the wealth management sector. iProov is trusted by the world’s most security-conscious organizations – such as the Department of Homeland Security, UBS, and the UK Home Office – and other banks such as Knab and Rabobank for a reason.
If you’d like to see how iProov’s Genuine Presence Assurance technology can secure and streamline your online customer onboarding and authentication, book an iProov demo here.