By Roy Urrico
To combat the increased identity fraud threats, Chicago-based information and insights company TransUnion recently unveiled its identity threat intelligence offerings within its TruEmpower solution line that features a proprietary artificial intelligence (AI) algorithm that provides consumers with a personalized risk score.
“Our consumer research shows upwards of three in four Americans consistently express concerns over having their identities stolen. Yet, when surveyed, most admit not taking any action at all,” said Mike Doherty, senior vice president and head of TransUnion’s TruEmpower consumer solutions. “This inaction has long vexed financial institutions that generally bear the brunt of fraud-related losses. People are actually very motivated to take action — they just need a trusted source and personalized guidance for what to do.”
TruEmpower’s enhanced BreachIQ capabilities can analyze an individual’s comprehensive data breach history, and generate a personalized dynamic risk score; and recommend actions to protect against identity crime. Much like a credit score does for credit history, Doherty explained, the identity risk score presents an aggregate risk picture based on an individual’s data breach history.
“Identity safety is a top financial goal of consumers. They want to understand and counter the identity threats they face. Yet, doing so requires much more personalization than they have been able to access. They now have clear insights and guidance at their fingertips,” concluded Jim Van Dyke, senior principal of innovation in TransUnion’s consumer interactive business.
Van Dyke provided Finopotamus with some detailed background and insight into TruEmpower’s enhanced capabilities.
Raised Risk Levels
The need for personalized data breach analysis comes amid an alarming rise in data breaches. In the first quarter of 2024, the Identity Theft Resource Center (ITRC) reported a 90% increase in data compromises compared to the first quarter of 2023. TransUnion’s ongoing fraud research also shows more than 20 million Americans have personal information, such as driver’s license numbers, credit card information and Social Security numbers (SSNs), exposed in data breaches each quarter.
TransUnion’s proprietary Breach Risk Score (BRS) revealed the severity of data breaches climbed to 4.6 in the first quarter of 2024, up from 3.5 in the first quarter of 2023. The BRS is compiled by assigning a risk score for each data breach — driven by the AI algorithm that analyzes more than 1,300 breach elements and their risks.
TransUnion’s algorithmic analysis discovered the increased breach risks emanated primarily from the high level of SSN exposures — which occurred in 78% of all publicly reported breaches during the first quarter of 2024. That is a significant rise from the same period in 2023 when SSNs were exposed in 51% of breaches.
Personalizing Protection
“The idea is that every consumer has a unique level and pattern of identity theft and fraud risks. The credit union can use our combination of our breach database, which is far and away bigger than anything they can get anywhere else, and then we run it through our AI algorithm. We are doing it in milliseconds computer time.”
Through the algorithm the consumer gets a personalized risk assessment. Through the product, the credit union can pass on the threats to their members. Van Dyke explained, “It might be the number one risk is IRS refund fraud, maybe it was their SSN, income information, or an employer exposed. Because you had different credentials exposed, it is like different keys exposing risk of different locks.”
Van Dyke added the application does not leave the consumer hanging. “The great majority of people do not do anything to protect themselves.” He explained they have done extensive research of people who are concerned about fraud but do not take any action to protect themselves. “They told us they're confused or overwhelmed by bad and conflicting advice, even from the best websites that advise you how to protect your identity.”
However, TruEmpower’s enhanced BreachIQ capabilities gives each consumer a personalized identity theft and fraud diagnosis. Said Van Dyke, “It is very dynamic. It tells you what your risk level is of becoming identity theft/fraud victim, and then it prescribes and guides you through the action steps that are most helpful to you, which will always be different than the ones that will be most helpful to me.”
Van Dyke described the dynamic assessment tool as containing over 55 actionable steps. Some of them are credit union and bank related such as strengthening two factor authentication, or providing alerts or card controls. Many are free services related to securing government accounts. “But it's customized like you'd expect from your doctor, you know, rather than a generic set of recommendations.”
Passing it On
TransUnion is making TruEmpower’s enhanced BreachIQ capabilities available to their credit union or bank clients’ accountholders. “I think people feel stupid when trying to navigate the whole realm of scams. And let's face it, you know, some of (recommendations) are sometimes less than valuable. We want take away people feeling dumb, because it is not them, it is the horrible confusion of this landscape,” pointed out Van Dyke.
Van Dyke added, “We want them to pass it on. when the credit union or bank leader makes this solution available to members or customers, they are not just building a tighter relationship with a member or customer, they are also protecting their own bottom line. You know, because it is fraud that is less likely to occur on their own accounts.”
Van Dyke noted the AI-based risk assessment tool does not use generative AI like ChatGPT or Gemini. “We make decisions that would be impossible for human beings to make in any kind of real time. That is represented by 1,300 algorithmic elements. it changes in real time, if you get a new breach, the whole mix changes.”
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