As the Dark Web Turns Darker, Mitek And DarkTower Partner to Combat Fraud And ID Theft

Mitek Systems Inc., a provider of identity-verification technology, is teaming up with DarkTower, the cyber-intelligence division of Davidson, N.C.-based IT consultancy Queen Associates, to combat account fraud and identity theft.

The partnership grew out the increasing role criminal marketplaces on the dark Web are playing in account and check fraud, as well as identity theft. Criminals turn to such marketplaces to purchase personal consumer and account data, according to the two companies.

The partnership will give customers of Mitek’s Check Fraud Defender real-time access to compromised account data. Check Fraud Defender uses artificial intelligence and machine learning to score 18 check attributes beyond account data to identify potential fraud and identity theft.

Mitek uses DarkTower’s sourcing and image-analysis technology to extract data from stolen documents, such as checks, account screens, and identification documents sold by online channels and in marketplaces on the dark Web. When a potentially compromised account is flagged, Mitek sends automated alerts to financial institutions so they can conduct victim searches using the company’s identity-verification platform, which launched in 2022

“The rise of nefarious activities has led to a proliferation of sensitive information being shared on criminal marketplaces and has increased the amount of identity theft and fraud taking place,” said DarkTower chief executive and president Robin Pugh, in a statement. “Our work includes identifying places where stolen information is being shared or sold and flagging this data to the proper parties to address.”

Fraud losses involving the use of fraudulent documents found in criminal marketplaces, including check fraud and identity theft, totaled nearly $8.8 billion in 2022, a 30% increase from the previous year, according to the Federal Trade Commission.

During the first quarter of 2023, losses from fraud and identity theft totaled more than $1.7 billion, compared to $2.1 billion in the same quarter of 2022, according to the FTC. During the quarter, the FTC received more than 750,000 reports of fraud and identity theft, up from more than 640,000 a year earlier.

“Financial institutions now have access to the tools to defend against the newest and most sophisticated attack methods used by those attempting fraud, including AI-generated documents and criminal marketplaces,” Michael Diamond, Mitek’s senior vice president and general manager, says in a statement. “Integrating insights from DarkTower … will enable financial institutions to move beyond passive defense to an active approach that reduces fraud losses and better protects their customers.”