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By James “Rick” Youngblood, CFE
In today’s security intensive business environment, organizations must rely on a variety of security devices to protect their assets and their controlled access areas.
Assets can be compromised by fraudulent activity, particularly through the use of easily obtained desk-top publishing software. Official-looking checks, identification devices, documents, etc., can be counterfeited with relative ease on almost any type of computer equipped with user-friendly software. These counterfeits are produced so precisely that they can fool even an experienced financial institution associate. Not to mention the fact that they can easily be produced at very low cost.
The other major problem area is access control. Here, security managers must understand and choose from a veritable laundry list of available security devices. Various types of access cards, smart cards, key pads, etc., are available and can be implemented into a physical security program. These control devices are effective, but they are only as good as the integrity of the card, key or number holder. Each of these items can be compromised by theft, accidental loss or counterfeiting. A majority of card access vendors advertise the security of their individual systems and the roadblocks they place in the way of counterfeiters. But if potential counterfeiting is a problem, the system cannot be 100% foolproof.
There is one very simple device that is available to almost every financial institution customer, business associate or authorized individual. Every one of these individuals has a distinct fingerprint. The use of the fingerprint, both in fraud deterrence and in access control, is making small waves in the very large security pool. This technology is relatively new to the industry, but it is the technology of the future. As we enter the next millennium, security and loss prevention managers must operate with an eye toward the future. They must stay away from trendy, soon-to-be-outdated security-related devices.
Except for a small percentage of the population, each living being can be identified by his individual and specific fingerprint. The fingerprint is unchangeable and nontransferable. It cannot be lost, stolen or counterfeited. Unless and until people begin carrying individual DNA identification cards, the fingerprint is the most likely identification device of the near and distant future.
Financial institutions in several states have already begun to implement the “inkless” fingerprint identification system for non-customer transactions. Whenever a non-customer makes a transaction at one of these institutions, he places one finger on a special pad. He then places the finger on the check face, leaving a permanent fingerprint. The financial institution now has a solid record of the check payee, while the customer is left with no messy ink-laden fingers to clean.
The inexpensive, specially designed pads can be purchased through several vendors and placed at each and every teller station. The print left on the check face is easily identifiable, and the leftover ink simply flakes away when the fingers are rubbed together. This low-cost but efficient system can provide a deterrent to the would-be criminal.
The various institutions where this process has been implemented have seen reductions in fraud loss claims of between 40 to 80 percent. These are significant numbers in light of the rapid increase in check fraud losses, and these results compare well to the previous years’ loss rates. The inkless fingerprint identification process must be presented to the customer as a deterrent process rather than as another “Big Brother” mechanism. Customers must be ensured that the fingerprints will not be used for a database, and that they will, in fact, never be processed unless there is a suspicion of fraudulent activity. Customers will be more accepting if they understand that they will benefit from lower processing fees if fraud losses are diminished.
Other business organizations have begun using this type of fingerprint identification system as well. Several truck rental agencies now require a fingerprint on the original contract. Financial institutions may also require that a fingerprint be placed on all new account applications and cash advance receipts. Financial institutions must set the industry standard, not follow a standard set by others.
The use of fingerprint technology is also making a strong presence in the field of physical security. Several security vendor organizations offer access control products that operate on fingerprint identification. Authorized fingerprints are retained within the system or on smart cards and used for comparison to screen individuals attempting to enter a secured environment. If there is no exact fingerprint match, access is denied.
With those systems that maintain authorized prints in a database, individuals who wish to enter simply place the required finger on the reader’s and access is either granted or denied within seconds. For smart card-reader systems, the authorized fingerprint is retained on the attached magnetic stripe. The individual attempting access simply swipes the personal smart card through the card reader, then places the required finger on the system reader. Access approval or denial is made within seconds.
The false rejection or acceptance rate for these types of systems is less than 0.1 percent. Please remember this is also a somewhat new and developing technology that can only be improved.
Fingerprint identification/access systems can be used either as stand-alone devices or in conjunction with smart card systems. PIN code requirements can also be implemented into the fingerprint access system. The more detailed the process, the higher the level of security. With less than a 0.1 percent false rejection or acceptance rate for this system, the use of other systems might be unnecessary.
Fingerprint identification systems can apply to other venues outside the point-of-entry arena. The system can also be used at point-of-sale terminals, ATM’s, computer log-on security, time card control, etc. Not only do these types of systems exclude unauthorized individuals, they also work to prevent various types of internal and external fraud. Smart cards can be programmed to contain all types of personal individual data; but they are exploitable if an almost foolproof verification mechanism is not installed.
The benefits of fingerprint identification and fingerprint recognition systems should be explored, investigated and utilized. It is much easier and more cost effective to be an industry-leading trendsetter than it is to be a constantly-spending-to-keep-up-with-today follower. The future is now; do not wait for it; make it come to you.
James “Rick” Youngblood, CFE, is President of JRY & Associates, an organizational security consulting firm.
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