What is Document Fraud? (How to Detect Fraudulent Documents Faster & More Accurately)

Lenders are increasingly susceptible to document fraud, as criminals attempt to exploit the system.

Years ago, the FTC filed successful lawsuits against the owners of online fake document sites like FakePayStubOnline.com. However, countless similar sites still exist. With just a few clicks, anyone can generate a fake pay stub, utility bill, or insurance document.

Knowing how to recognize document fraud can save you from expensive losses. Automated fraud detection software can help.

What is document fraud?

Document fraud is the creation, alteration or use of fraudulent documents to obtain a loan or other benefit. Fraudsters may use multiple methods to commit document fraud.

Typically, these scammers rely on:

• Forgeries

  Criminals can commit document fraud by altering legitimate documents, such as pay stubs, to inflate income or assets. For example, a borrower might change the date on an old pay stub to make it look like their current income.

• Counterfeit documents

  Sometimes, the entire document is fraudulent. Fake social security cards and passports often establish a fraudulent identity.

• Pseudo documents

  You may also encounter documents boasting made-up credentials, like a global travel pass instead of a passport.

How does document fraud happen?

Fraudsters range from blundering novices to near-perfect masters when creating fraudulent loan application documents.

The novices are easy to recognize. They use easily detectable forgeries or counterfeits, often with mistakes that anyone could spot.

Expert scammers are tougher to identify. You need experience or the help of AI to uncover their sophisticated forgeries and document tampering. Ocrolus has detected many document fraud schemes, such as when a criminal took someone else’s bank statement, changed it, and passed it off as their own.

Masters are the hardest to catch. Their documents are so convincing and the tampering is unnoticeable, even experienced lenders are fooled. In other common cases, Ocrolus has discovered forged financial data. The forgers used their real bank statements but manipulated the balances.

How automation can help detect document fraud

Intelligent fraud detection automation is the best way to uncover document fraud.

Ocrolus Detect uses AI to read and analyze documents in seconds. It can identify over a dozen types of document fraud, including common identifiers such as:

• Forged signatures
• Altered dates
• Counterfeit documents
• Inconsistent information

Detect’s algorithms have been trained on more than 100 million pages of documents from thousands of financial institutions. This experience gives Ocrolus an unparalleled understanding of what “normal” looks, so we can flag even the most subtle abnormalities.

Ocrolus Detect combines automated fraud detection with human review. Our experienced analysts provide a second layer of protection, ensuring that no fraudulent document goes undetected.

Confidently approve more borrowers

Using comprehensive document fraud detection software like Ocrolus can help you make faster lending decisions and approve more borrowers.

The AI-powered platform reduces your risk by uncovering 10x more file tampering. The increased efficiency minimizes the need for your team to perform manual loan reviews.

Document fraud is a serious problem that can be hard to detect. However, with the help of intelligent automation, you can quickly and easily screen for sophisticated schemes. Ocrolus Detect uses AI to quickly analyze documents and identify abnormalities. Those abnormalities are then laddered up for human review to ensure the ultimate protection.

Try Detect now and see how your business can transform your document fraud detection process and prevent costly losses down the line.