Unmasking Identity Fraud in the Digital Age

As digital technologies increasingly permeate all sectors - from banking, finance, and insurance to public administration - identity fraud has become an all-too-familiar threat. In the online environment, identity verification plays a pivotal role in digital service delivery, yet it remains one of the most vulnerable links in the security chain.

So what are the most common types of identity fraud today? Why can organizations no longer rely on traditional verification methods? And what advanced technologies can effectively counter these evolving threats?

Common Forms of Identity Fraud

With the rapid advancement of technology, financial institutions, e-wallet service providers, e-commerce platforms, and even public service portals are facing growing threats from increasingly sophisticated identity fraud schemes. Some of the most prevalent types include:

• Forgery of Identity Documents: Counterfeiting chip-based Citizen ID Cards through color printing, software manipulation, QR code spoofing, information tampering, or replacing the portrait photo.

• Facial Spoofing: Using printed photos, videos, 3D masks, or deepfake technology to deceive facial recognition systems.

• Unauthorized Use of Real Identity: Stealing CCCD data or personal information to open bank accounts or apply for loans without the individual’s consent.

• Synthetic Identity Fraud: Combining real and fake data to create entirely fictitious identities that can bypass traditional verification systems.

According to the National Cybersecurity Association, Vietnam has the highest rate of deepfake-related fraud in the Asia-Pacific region (25.3%), followed by Japan (23.4%). These alarming figures underscore a clear warning: without modern and reliable identity verification technology, all digital transformation efforts are at risk of exploitation.

The Consequences of Failing to Detect Identity Fraud

Allowing identity fraud to slip through the cracks has consequences far beyond financial loss. For businesses and organizations, the impact can be severe:

• Direct Financial Losses: Criminals exploit system loopholes for fraudulent transactions, fake loan applications, money laundering, or scams.

• Brand Reputation Damage: When real customers fall victim to identity theft, complaints and legal claims can trigger widespread loss of trust.

• Regulatory Risks: The Vietnamese government has issued numerous regulations requiring organizations to safeguard personal data (Decree 13/2023/NĐ-CP) and ensure secure electronic authentication when offering online services (Circular 50/2024/TT-NHNN). Non-compliance may lead to serious administrative penalties.

• Operational Disruption: Post-incident response is often resource-intensive and time-consuming, reducing the efficiency of digital operations.

Given these risks, implementing a compliant and robust digital identity verification system is no longer optional—it is a critical requirement for any digital transformation initiative.

Key Technologies for Combating Identity Fraud

Modern identity verification goes far beyond collecting photos or scanning documents. Leading solution providers are now leveraging advanced technologies to stay ahead of fraud tactics, including:

• Chip-based ID Card Data Reading and Analysis: Enables verification directly from the chip, identifying any signs of tampering or forgery.

• Facial Recognition (Face Matching and Liveness Detection): Matches a live face with ID photos and detects signs of spoofing using motion, lighting cues, or fake media like deepfakes.

• Behavioral Biometrics: Identifies users based on interaction patterns such as typing speed, mouse movement, and touchscreen behavior.

• AI-Powered Anomaly Detection: Uses deep learning to recognize new fraud patterns based on data from millions of transactions.

Despite their sophistication, not all technologies are equally effective in Vietnam’s complex regulatory environment and data formats. Solutions must be adapted to the local context to ensure accuracy, security, and compliance.

FPT eID – The Digital Shield for Enterprises and Organizations

With over two million chip-based ID cards verifications conducted monthly, FPT eID is a pioneering digital identity verification solution trusted by leading enterprises across Vietnam. Its key strength lies not only in advanced anti-fraud technology but also in a deep understanding of Vietnam’s digital and legal environment.

Chip-based ID Card Authentication Compliant with Ministry of Public Security Standards

FPT.IDCheck, the product of FPT eID, enables direct data extraction from the chip, detecting any physical or digital alteration. The solution is developed and certified by the Ministry of Public Security, fully compliant with Decree 59/2022/NĐ-CP and the latest Circular 50/2024/TT-NHNN on secure online service delivery.

Facial Recognition with 100% Accuracy

FPT eID’s eKYC solution incorporates Face Matching and Liveness Detection technologies capable of detecting sophisticated spoofing attempts using printed photos, video replays, deepfakes, 3D masks, or paper masks. Real-world tests show the system achieves up to 100% accuracy with sub-second processing speeds. FPT eID’s facial recognition engine is certified with two of the industry’s most prestigious international standards:

• ISO/IEC 30107-3 Level 2 for anti-spoofing biometric performance

• ISO/IEC 19795-2 for facial image comparison.

These certifications ensure readiness for Vietnam’s upcoming regulatory requirements under Circular 50/2024/TT-NHNN (effective from July 1, 2025).

Enterprise-Grade Security

Customer data is encrypted using AES-256, segmented according to the State Bank of Vietnam’s data protection standards, and stored only as necessary. The system supports rapid integration via API, making it ideal for banks, financial institutions, insurance providers, and e-commerce platforms.

Real-Time Fraud Detection Alerts

FPT eID’s AI system can immediately flag suspicious activity, such as invalid CCCDs, unmatched facial data, or signs of biometric spoofing.

Who Should Be Paying Attention?

• Banks, credit institutions, e-wallet providers: Processing thousands of new account openings and loan applications daily.

• E-commerce platforms, recruitment sites, online public services: Require robust user onboarding to prevent seller or applicant impersonation.

• Insurance, healthcare, education, real estate: Where verifying the true identity of participants is crucial.

With FPT eID, enterprises can seamlessly integrate digital identity verification into their systems without complex infrastructure investment while maintaining a smooth user experience and mitigating fraud risks.

Conclusion

Identity fraud has become a critical vulnerability in the digital service model. Identity verification is no longer a “nice-to-have” but a vital safeguard for protecting an organization’s brand, assets, and data.

FPT eID offers a robust, secure, and government-certified solution with unmatched accuracy, making it a trusted choice to counter even the most advanced fraud tactics. Because a truly sustainable digital journey starts with a verified identity.

 

References:

1. How much is your identity worth?