Over the last two decades, the global fight against financial crime and terrorist financing has led to an enhanced regulatory regime for Know Your Customer (KYC) and Customer Due Diligence (CDD) – with most organizations adopting these checks to verify the identity of their clients.
However, we live in an internet-crazed era dominated by massive technological advancements that have increased money laundering activities through identity theft. According to PwC, the US lost $42 billion to fraud in 2020. The situation is a little better in Europe, while the fraud rates in Africa and Asia are much higher.
Moreover, the COVID-19 pandemic has forced many organizations to move to an online-first business model, where the customer is not physically present to allow in-person KYC checks. On the other hand, fraudsters have developed tactics to bypass some of the existing conventional checks.
This new business environment has made remote identity proofing and assurance a must. This is where liveness checks come in. Typically liveness checks use Artificial Intelligence/Machine Learning (AI/ML) software to increase efficiency in digitally verifying user identities. There are two types of liveness checks, active and passive biometric checks.
Active Biometric Checks
Active liveness checks require the user to perform specific actions in front of the camera to prove their identity. Such actions include blinking, turning the head, following a dot on the screen with the eyes, smiling, etc.
In this case, if a fraudster is using someone’s documents, they will be scared to go through the active check, or the check will find out that they are faking their identity.
And while active biometrics may appear like an ideal Anti-Money Laundering (AML) solution, it’s sometimes faced with challenges such as spoofing by fraudsters through presentation attacks.
Here, a bad actor can trick the system through different tactics; for instance, if the check requires the user to blink, the impersonator can wear a print cut-out of the person they are impersonating and then use the eye cut-out to blink when need be.
Besides, some fraudsters use more sophisticated tactics such as video replays, deepfakes, and other animation software.
Generally, active liveness demands more time and effort from the user, which may make impatient users drop out. However, customers who want a high level of assurance regarding the safety of their accounts may see this as an ideal verification method.
Passive Biometric Checks
Unlike active biometrics, passive biometric checks don’t require the user to perform any actions. Here the AI/ML software runs in the background performing necessary checks without the user realizing it.
With passive liveness checks, users and potential fraudsters are often unaware that an identity verification check is happening, which reduces user interference, making the check more spoof-proof.
Passive biometrics have a higher capacity to detect traces of presentation attacks such as skin texture, edges, and depth that differentiate a live person’s face from a spoofed or inanimated face.
Besides, passive checks effectively point out masks, deepfakes, and software that mimic smiles, blinks, and other facial expressions. Due to their spoof robustness, passive biometrics make it challenging but not entirely impossible for fraudsters to pass through.
Compared to active liveness, passive liveness takes very little of the users’ time, and the entire process is much smoother because the user isn’t required to perform multiple actions in front of a camera.
Active vs. Passive Biometrics
In a nutshell, both types of liveness checks go a long way in helping organizations detect and stop fraudulent and money laundering activities. However, none of these checks boasts ultimate superiority because they both offer protection against fraud depending on the needs of the organization in question.
So, the choice between active and passive biometrics narrows down to the organization’s risk-based approach. You should opt for one that meets the user verification needs of your company while still creating a positive user experience and keeping you ahead of the game.
Please get in touch if you would like to learn more about liveness checks and how our certified liveness detection technology can fit your use case.