AWS Partner Network (APN) Blog

Enhancing Document Fraud Detection in Financial Services with Fortiro and AWS

By Amir Vahid, Chief Technology Officer – Fortiro
By Senthil Nathan, Partner Solutions Architect – AWS
By Snehanshu Bhaisare, Partner Solutions Architect – AWS

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Financial institutions face a critical challenge: balancing rapid lending, payment or insurance claim decisions with effective risk management. This dilemma affects banks, lenders, payment providers and insurers who must maintain security while meeting growing customer expectations for quick service. Despite advances in digital technology, document-based verification remains the dominant method for validating critical information.

This continued reliance on document processing creates two problems. First, manual document reviews results in operational bottlenecks, increasing costs and processing times. Second, documents are vulnerable to manipulation, creating opportunities for fraudulent loan applications, payments or insurance claims.

These challenges highlight the need for solutions that can streamline document processing while maintaining robust security measures, ultimately helping financial institutions better serve their customers while protecting against fraud.

Fortiro, an Amazon Web Services (AWS) Independent Software Vendor (ISV) partner, is a leader in this field, offering an innovative solution specifically designed for financial services institutions. Fortiro helps automate and enhance document fraud detection, providing robust solutions to identify and mitigate fraudulent activities with advanced technology.

Document Fraud: A Global Issue

Document fraud is a global issue, resulting in huge financial losses. In recent years, losses were over $10 billion in North America, primarily due to identity theft and counterfeit documents. Europe faces €1.2 billion in annual losses from forgeries via organized crime. In Asia-Pacific, rapid growth and inconsistent regulations drives document fraud, with the region facing the highest proportion of document fraud activity.

The cost of addressing fraud for financial institutions has been steadily increasing. Research indicates that for each dollar lost to fraudulent activities, the expenses associated with combating and resolving fraud have risen year over year. In 2020, these costs were $3.64 per dollar of fraud. This figure grew to $4.00 in 2021, then to $4.23 in 2022, and reached $4.41 in 2023. Figure 1 below shows the steady increase in cost to combat document fraud, with organizations facing a steep 21% rise in related costs over a four-year period, highlighting the urgent need for more efficient fraud prevention solutions.

Cost to Address Document Fraud

Figure 1 – Cost to Address Document Fraud

Understanding Manual Document Verification and Fraud Detection

The manual document verification process consists of two essential components that work together to ensure document authenticity and accuracy. First, fraud detection measures involve thorough content analysis to identify inconsistencies in payment dates and transaction data. This is coupled with sophisticated tampering identification that examines digital attributes for signs of alteration, and pattern recognition that spots suspicious templates or unusual document layouts.

The second component focuses on verification requirements. This begins with identity confirmation, where applicant details are cross-referenced with document information. It continues with employer authentication, validating business credentials through tax registrations and business numbers. Finally, a comprehensive documentation review ensures all required materials are present and comply with policy standards, including age requirements.

These systematic checks create a robust verification framework that helps maintain security and accuracy in financial transactions. However, this manual process, while thorough, can be time-consuming and resource-intensive, highlighting the need for more efficient solutions in today’s fast-paced financial environment.

Automating Document Fraud and Verification Checks

Fortiro Protect, Fortiro’s document fraud prevention solution, is natively built on AWS technology and offers customers a robust way to fight fraud in lending and insurance. As an AWS partner, Fortiro integrates with key AWS services such as Amazon ECS, Amazon S3, Amazon RDS, AWS Lambda and Amazon SageMaker for efficient document processing, advanced feature engineering, and sophisticated fraud detection. Fortiro automates the process of document fraud and verification checks in the following ways:

Content analysis

A content analysis involves checking a document for inconsistencies and verifying information. For example, comparing information within the document for consistency, or against trusted data sources, such as confirming business registration numbers with official government records.

Layout and visual analysis

Fortiro’s solution thoroughly analyzes the document structure, revealing variations invisible to the human eye. The system identifies specific differences in fonts, formatting, and layout elements like table positioning and logo placement. Where manual reviewers might miss subtle alterations, Fortiro’s analysis reveals microscopic changes in document composition and structure.

Digital analysis

Fortiro analyses the digital structure of a document, including its metadata, layers, and hidden text, to spot any signs of tampering or forgery.

Using these techniques, Fortiro can detect fraudulent documents accurately, whilst fast-tracking genuine documents. Compared to other approaches, which may only focus on a particular technique (e.g. such as using Optical Character Recognition (OCR) tools to verify the content), Fortiro combines a broad range of methods across all three techniques to analyze documents.

As a result, lenders can approve loans faster while reducing the risk of fraud. Similarly, insurers can approve claims faster without risking fraudulent payouts for fake claims.

Solution Overview

Fortiro’s solution combines a comprehensive and configurable fraud-rule engine with deep learning and statistical anomaly detection to uncover patterns in documents that go unnoticed by the human eye. After analyzing millions of documents, Fortiro provides advanced insights that help accurately interpret even the most complex documents.

Fortiro Protect Solution Overview

Figure 2 – Fortiro Protect Solution Overview

Document Processing

The process begins when an applicant submits their loan application or insurance claim with supporting documentation. These documents often arrive in various formats and quality levels, from professional scans to smartphone photos, requiring a flexible processing system. Fortiro’s system automatically identifies and categorizes different document types, even when bundled together, enabling specific fraud checks for each document type. The system then extracts crucial information, including digital properties and key-value pairs, for verification.

Feature Engineering

In the feature engineering phase, Fortiro analyzes key document attributes to identify anomalies and inconsistencies. This analysis varies by file type – PDF documents undergo structural examination, while image files receive visual analysis. The system processes and enriches this information without storing sensitive document contents, addressing privacy concerns for enterprise clients.

Information is gathered from multiple sources: document content, digital properties, and visual appearance. This information is then processed, enriched, and profiled. The analyzed data provides a rich foundation for fraud detection. All of this can be achieved without storing the actual document itself, or its potentially sensitive contents – a critical requirement for Fortiro’s enterprise clients.

Fraud Detection

The fraud detection process leverages years of industry expertise to identify fraud indicators. Fortiro’s proprietary AI algorithms and heuristic methods evaluate documents against these indicators, applying both simple and complex rule combinations. Organizations can customize these rules and alert thresholds to match their risk appetite and operational capacity.

Fraud Results

Finally, each document receives a fraud score reflecting potential risk. Fraud teams can access a web-based interface for detailed forensic investigation, examining specific fraud rules and making informed decisions about document authenticity. This comprehensive approach ensures accurate, efficient fraud detection across diverse document types while maintaining security and customization options.

Fortiro’s Solution In-Action

Fortiro works with leading banks, lenders, payment providers and insurers, to automate previously manual fraud detection processes, reducing time spent on document reviews. Pepper Money, one of Australia’s largest non-bank lenders, adopted Fortiro’s fraud detection and document verification solution to tackle manual document reviews and streamline its lending process.

By integrating Fortiro Protect into its lending workflow, Pepper Money automatically runs comprehensive fraud checks on critical financial documents, such as payslips, in just 30 seconds. Pepper Money also utilizes another Fortiro solution, Fortiro Accelerate, to extract and verify income and expenses. As a result, key income information from financial documents flows directly into Pepper Money’s loan decision systems. The automation reduces the need for human intervention, speeds up loan approvals, and ensures strict fraud detection standards are upheld.

In the words of Pepper Money’s Head of Sales (Asset Finance), Andrew Gamble, “We have grown, well above the market, and we’ve done that by listening to our customers. We know what they want – they want a great system; they want a great process, and they want their money faster. So that’s what our automation does, and our work with Fortiro takes it to the next level”.

Conclusion

By leveraging Fortiro Protect’s AWS-powered capabilities, financial institutions can transform their document verification processes from a potential vulnerability into a competitive advantage. The solution not only addresses immediate fraud prevention needs but also positions organizations for future growth by balancing security with operational efficiency.

As the financial landscape continues to evolve, institutions that adopt advanced fraud detection technologies will be better equipped to protect their assets while delivering the seamless, rapid service that customers expect. Don’t let document fraud and manual processing hold your organization back – take the first step toward modernizing your risk management strategy with Fortiro Protect.

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Fortiro – AWS Partner Spotlight

Fortiro is an AWS ISV Accelerate Partner dedicated to the ongoing innovation of enterprise-grade document fraud and verification solutions. As an AWS ISV Partner, Fortiro continues to be a market leader, strengthened by AWS capabilities. Contact Partner | Partner Overview | AWS Marketplace | Customer Case Studies