O2 stops fraudsters with online ID checks

O2 is making it harder for fraudsters to set up mobile phone contracts by using an online identity verification system.

The verification system, called 'URU', was introduced in August to all of O2's 350 UK stores and those of major retail partners, including The Link which O2 acquired earlier this year.

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O2 wanted to update the traditional ID checking system, which previously relied on store staff being able to confirm the authenticity of paper documentation such as bank statements, utility bills and driving licences.

Neil Harvey, O2 head of credit and risk, said: "With the prevalence of online billing and the improvements in the quality of colour printing these documents have become very easy to forge in recent years and [it's become] increasing difficult to spot forgeries."

By using the system O2 has been able to reduce the number of fraudulent accounts it has to disconnect by more than 40 per cent.

Hard figures on ID fraud are difficult to come by, although the government estimates it could cost £1.7bn per year.

O2 worked with data services company GB Group replace its customer verification processes with electronic methods.

Harvey said: "The new system removes subjectivity from the identification process."

p>A customer going into an O2 store will have their details entered into the system, including name, date of birth and credit card details.

O2 said the pieces of information it asks for are details that a potential fraudster would not find all in one place - such as in a stolen wallet or bag - making it very difficult for individuals to perpetrate ID fraud.

A spokesman from O2 added: "Clearly we don't like to broadcast what information we ask as it could give opportunist fraudsters a head start but it includes taking credit card details plus other personal information from the purchaser."

The customer's status is then assessed by the URU system, which includes an ID check on the customer's personal information and a credit check of all the customer's credit and debit card.

O2 processes nearly 20,000 new customer accounts every week and Harvey said the URU system has cut down the time it takes to deal with customers.

He added: "We no longer have to check and copy paperwork used to prove identity, helping to ensure quick and consistent decisions and reduced processing times."

Harvey said the new system also required minimal training for staff because "the design was consistent with existing systems so staff were used to the format and workflow".