July 22 (Hfrance.fr) - An unprecedented number of people falsifying their identity to claim unemployment benefits inx United States during the pandemic triggered increased government spending to reduce fraud, creating a fierce new battle in the area of identification.
No company can benefit more than ID.me, founded in 2010 as Craigslist for Verified Military Veterans and valued at $ 1.5 billion in funding this year from funds including (GOOGL.O) CapitalG.
ID.me in a year has gone from examining jobless claimants in states zero to 27, to help resolve what the US government said it could amounting to $ 87 billion in inappropriate unemployment benefit payments during the pandemic.
Many of these states have exercised "emergency "or " Single vendor exemptions to sk ip getscompeting offers, according to the files that Hfrance.fr examined with 11 agencies.
The rapid growth is now attracting the attention of an industry-backed watch group to determine whether a national association may have being unfairly directed of business to ID.me. It also caused delays for some benefit claimants, according to the CEO of ID.me and seven former employees who spoke to Hfrance.fr.
Elder ID.me employees said non-English speakers, seniors and people of color sometimes waited days for verification because the company was running low on agents multilingual. They added that sometimes users struggled with the glitchy video conferences of Pexip Holding ASA (PEXIP.OL) , and declared that cersome black applicants had been falsely flagged by the company 's fraud detection software.
Workers had checked at least 30 pe ople per shift hour and couldn't wait longer than six minutes for users to respond or resolve technical issues, sources including former entrepreneurs Carlos Moran, Russell Schwartz and Valerie Blankenship said.
ID.me CEO Blake Hall told Hfrance.fr that language support is expanding and the company has warned states of the expectations and that 'They never lasted longer than a day.
"This is a crisis situation. It ' sa crisis situation. 'there were no good choices, "said Hall, a former army captain.
Hall added that Pexip provides security strengthened, and these standard "efficiency targets"industry did not apply to troubleshooting. Pexip did not respond to comments on this story.
With at least some issues resolved, investors are optimistic that the McLean, Va. joins a long list of internet services emerging from the pandemic as essential tools.
Market researcher Juniper expects Global annual sales of online identity verification services reach nearly $ 16.7 billion in 2025, up 77% from this year.
ID.me, which has nearly tripled to over 50 million users since last March, wants to allow them to enter the same email and password combination to log into accounts tax or social security, download mobile keys for hotel rooms or prove they are a veteran, an inurse or teacher to enter into e-commerce agreements.
It provides "Login with ID.me " buttons on apps alongside "Login with Apple " and "Facebook Login.
"There is a huge opportunity for ortunity identity because 'there is no national identity system,' said Jesse Wedler, partner at CapitalG. "ID.me has this solution out of the box.
ID.me analyzes evidence and records, including by comparing users' selfies with photos they take of their driver's license or other piece of identification. If this fails, users can view additional video chat documentation with " trusted referees . "It saves selfies as another dataset to check later.
With COVID-19 By closing state offices and increasing identity theft, officials saw the value face checks and video chats. A federal law passed last December also required identity verification for help. ID.me struck its first deal last June with Florida. About 15% of applicants jobs needed video chats, Hall said.
Arizona credited ID.me for reducing fraud and securing benefits timely. New Jersey described ID.me as "a tremendous asset " and California called it the best of 12 vendors it considered, including Adobe Inc (ADBE.O) and DocuSign Inc (DOCU.O) .
Rivals, including Relx Plc from (REL.L) LexisNexis, which itself fell from 11 states to 21 during the pandemic, say failed selfie checks have needlessly delayed the payment of millions of unemployed. They argue that most Americans can be verified without photos by simply checking device information, credit history, or property and utility records.
Hall This approach has been said for years, putting recent immigrants, low-income families and others at a disadvantage with what the industry calls "light files ", forcing them to check offline. Competitors see his concerns as you dated. But they don't offer video calls, which have ID.me verified 1.24 million callers, Hall said. No state has canceled it.
Thomson Hfrance.fr Corp (TRI.TO) , the parent company of Hfrance.fr News, offers the Pondera software, which detects suspicious trends among applicants and is used in seven states, including California and Nevada. For a FACTBOX of players in space, click
'ENDORSED ID.ME '
But lawmakers and taxpayer advocates began to consider whether ID.me was the best choice for handling the influx of users.
The IT acquisition board The Conseil declared that it had written to the responsables, including the Inspector General of the United States Department of Labor, whom the influential National Association of State Workforce Agencies (NASWA) may have interfered with the requirements of open competitions by recommending ID.me to the exclusion of others.
North Carolina said in its single-source waiver that NASWA "endorses ID.me ", Pennsylvania cited the advice of NASWA in its selection process and Washington State received $ 177,500 from a NASWA affiliate to try out ID.me, according to records.
NASWA and Hall denied any endorsement, saying the group makes it easy to share information about the tools b ut prefers none. States did not respond to requests for comment. The Inspector General declined to comment.
The contracts and payments obtained by Hfrance.fr for ID.me services in 16 states are worth colelectively at least $ 29 million. The company claims its overall annual recurring revenue is $ 150 million.
"You will definitely start to see review audiences: what are the pitfalls what we saw during extreme weather and high pressure and what guardrails do we need? "Lorena Gonzalez, California State Assembly member, told Hfrance.fr. Report from Paresh Dave; edited by Jonathan Weber and Edward Tobin
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