Wednesday, June 19, 2024

EXCLUSIVE: “Nowhere to hide” – Garient Evans, Trulioo in “The Fintech Magazine”

Garient Evans, VP of Identity Solutions for global identity verification company Trulioo, says it’s determined to ‘turn over every rock’ when it comes to data transparency – as much to unlock freedoms for the least powerful, as to hold the most powerful to account Geraint Evans, Trulioo | Fintech Finance

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 Our mission is to give individuals access to digital experiences, not just to consume but also to work in a global way. Markets are no longer limited by proximity

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-evading 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, from BBC Panorama to the Washington Post, the Australian Broadcasting Corporation to Le Monde. 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 of the most serious pandemics in history.

Breaking as it did, during such fragile geo-political operating environments, most of us have reacted with outrage. 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.

The company is now turning its attention to shining a spotlight on the shadows where unscrupulous 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.

Its goal is full transparency that enables companies to do business, governments to maintain tax regimes and national security, and individuals to manage their finances, in full knowledge of what 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 know their suppliers, their merchant, their business. We call it know your business (KYB), and we think that’s 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 business you’re dealing with, who the owners are and whether or not they’re on financial sanctions or designated persons list for terrorist financing or money laundering, we can help.”

Dramatically increasing its number of worldwide data sources is a key stepping stone towards 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 pre-negotiated the arrangements, implemented them, standardised them, and made sure they’re robust enough to provide quality identity verification solutions in these high-growth markets that matter.”

Bringing emerging markets into the fold is both commercially attractive, and essential to Trulioo’s goals of increasing financial inclusion and transparency, and helping prevent fraud.

“If you want data sources in the US, you have many, many options and, in some cases, they may not be very differentiated, so then you’re competing on things like price, or can you bundle in a lot of sources,” adds 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.”

He 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,” says Evans.
“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 as nicknames and regional differences.

“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 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?

“Identity, and the process of matching, 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 say ‘that should be appropriate for matching identities in Dubai, Argentina or Ethiopia’. There are lots of regional differences.

“Not everybody uses the roman language and roman characters; we have different characters around the world and have to be able to match against those. 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? We take 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 himself, growing up in one place and moving to another. As the Pandora Papers have shown, those who have the means, 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. But a date of birth and national identifier should be a static, one-to-one relationship,” says Evans. “However, 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. We can account for that complexity, working with partners that have the depth, can look at the history and help us determine the most recent and relevant data for each person.”

Having the right parameters in place is also vital for 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 multiple, 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, how often they are producing false positives or negatives, which is even scarier, because you think you don’t have a match but it should’ve been a match and 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 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.”
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. 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 70s. 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, without having to go to a bank branch.”

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 adds. “Folks who were working in face-to-face settings had to 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. Markets are no longer limited by proximity.”

But opening this particular Pandora’s Box of comprehensive 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 from being there and providing 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 become 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 traditional financial service providers, 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. “We serve some of the largest and most sophisticated financial services providers globally, and even institutions that have been operating in multiple countries for 100 years need our services.

“We move with the times, with the individuals whose identities we’re verifying, keep pace with where they’re going and what they might be applying for at a given time. “In certain jurisdictions, address is one of the most important factors, for example, in cryptocurrency, 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 their auditor is telling them is acceptable. So, with nicknames, a strict matching posture will only accept ‘Jonathan Smith’ as a direct match. But, with tolerance, you can accept matches with the ‘Jon’, ‘Jonny’ or ‘J’ derivations of that name, to create a more convenient onboarding experience for somebody who’s gone as ‘Jon Smith’ their whole life but their documentation shows ‘Jonathan Smith’.  We discuss this with clients and test what their match rates are with higher tolerance, what we call fuzzy matching, like nicknames or one-time errors, such as the transposition of numbers in a phone number, which is off by just one digit. In other regimes, requiring strict matching, we can show the repercussions of that for onboarding.”

It’s hardly surprising, given the pandemic-fuelled growth in digital interactions, that Trulioo has been on a dramatic upward trajectory since a successful funding round in June 2021. This year, it was also listed among Canada’s 100 fastest growing companies (503 per cent a year), and included in the Narwhal List of successfully-scaling private enterprises. Its $394million Series D funding round, led by growth equity firm TCV with participation from existing investors, increased Trulioo’s valuation to $1.75billion and gave it the capital to accelerate its goal of becoming an end-to-end identity platform. By the end of this year, the size of its overall workforce will have increased two-fold, with new offices established in Austin, Texas and San Diego, specialising in developments such as artificial intelligence and machine learning. With a current, 260-strong workforce distributed across Canada, the States and Ireland, it plans to add an additional office, in Asia, in 2022.

The demand it’s experiencing is a reflection of macroeconomic conditions, says Evans.

“Activities people might’ve been willing to do face-to-face, before the pandemic, have been driven online, from opening accounts to ordering their groceries or meals for delivery from their favourite local restaurant and conducting their entire financial lives online. So, we’ve continued to see companies coming to us that are launching new digital initiatives, to offer their products and services more conveniently online.

“And institutions that have had success in a single market are saying ‘we think we have an audience in multiple markets and want to expand to new territories’. Instead of coming up with identity solution providers in each of those regions,  they’ve heard how, over the last 10 years, we’ve developed the data sources to conveniently and security identify folks in each of these territories, and are deciding it’s easier to work with us.

“There are businesses that no longer exist, as a consequence of the pandemic, which is very unfortunate but has answered the question about whether or not companies can persist, not being technologically-enabled and connected to digital experiences. I think maybe those that never invested, decided not to accommodate remote access to products and services, didn’t survive.

“Because consumers are finding the new way of doing things so convenient, they’re deciding to stay with it.”

All of this means that those companies still in the game will have to continually up the ante in terms of their online customer service.

“A decade ago, the largest e-commerce retailer gave us the one-click shopping experience. You could buy anything you wanted with one click, and that has set the bar for everybody else. How do we match that digital experience with safety and convenience, to create this trust that customers will get the product and service on time, and that the data they provide will be held responsibly? Everybody who’s working online is trying to replicate that super-convenient and safe experience.”

Whether you’re one of those retailers, onboarding a single consumer in a distant market, or a corporate that wants to be confident it’s dealing with a counter-party that’s not flying close to the moral wind, it’s useful to have a transparency trail-blazer like Trulioo on your side


This article was published in The Fintech Magazine #22, Page 6-8

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