How to Prevent Account Signup Fraud

Account signup fraud is one of the biggest issues for online companies today. It can affect a wide range of businesses from online retailers and financial institutions to online gaming sites. New account fraud can be perpetrated by bots, human click farms, and phishing scams. These types of fraudulent activity are difficult to detect, but there are ways to mitigate them.

One of the easiest ways to prevent account signup fraud is to use a secure password policy. Make sure you create strong passwords that include numbers, letters, and special characters. Use a separate password for each platform you are signed up on. Some businesses also require a photo of an ID and a phone number. If you cannot verify these items, make sure to provide alternative verification options.

Another way to protect your business from new account fraud is to verify the email address of each new customer. This is important for a variety of reasons. For example, you may be able to prevent free trial abuse by requiring the email address to be verified before allowing the trial to continue. Similarly, if you offer referral bonuses, you need to be able to verify the email address of those who are referred. Also, be sure to check for spam accounts.

Another method to identify suspicious accounts is by examining the behavior of users after they are registered. You can look for indicators of fraud in their post-account creation actions, such as a change in their profile or adding a payee. In addition, you can review the device they are using to register for an account. The use of a VPN or other technology can help you determine if a user was attempting to sign up for an account from a location that is suspected of being compromised.

When a new customer signs up for an account, it’s natural for them to interact with account signup fraud prevention the website in a predictable manner. You can use tools like IPQS to monitor this behavior in real time. IPQS is a comprehensive tool that allows you to verify the identity of each new user in a matter of seconds. With over 300 data points, you can easily spot potential fake users and eliminate them from your system.

Using a Graph, you can quickly identify if a large number of new accounts are tied to a single IP address. If the number of accounts on a specific date and time is higher than expected, it could be a sign of a fraud ring.

Another way to identify suspicious accounts is to check for “honeypot” fields. These are hidden fields that are used by some businesses to prevent the creation of fake accounts. They can be manipulated by bots, who will fill them in automatically. While these fields can be helpful, they do not provide all the information you need to determine if the person is legitimate or not.

If you need more specific data, you can utilize a tool that analyzes your existing account database. This can help you determine if the account is being created by a bot or a real user. Additionally, this will show you if an image or document is fraudulent.