LSEG: Pioneering Verification Tools to Combat Payment Fraud

London Stock Exchange Group (LSEG), which provides data and infrastructure solutions to financial markets, has unveiled two verification products aimed at tackling rising payment fraud and identity theft across international banking networks.

The tools are designed to support financial institutions processing cross-border transactions.

Payment verification and regulatory landscape

The first product, Global Account Verification (GAV), addresses authorised push payment (APP) fraud - where customers are tricked into willingly transferring money to fraudulent accounts. 

The system will operate across 22 countries initially, providing real-time checks of bank account ownership before transfers are processed.

The launch comes as UK Finance reports £213.7m (US$277m) in APP fraud losses during the first half of 2024. 

This pressure on financial institutions has prompted significant regulatory changes, with the European Union implementing new rules requiring payment service providers to offer continuous instant payments from January 2025 and mandating account name and IBAN validation from October 2025. These changes will affect all payment service providers within the bloc.

GAV equips financial institutions with a three-tier assessment system, categorising potential transfers as "match", "close match" or "no match". The service is designed to expand coverage to 80% of G20 nations, though no timeline has yet been specified for this expansion.

Biometric security and digital identity

The second product, Document and Biometric Verification (DBV), combines facial recognition technology with document screening and liveness detection to combat the rise of deepfake fraud in digital banking. 

This addresses concerns about synthetic media being used to circumvent standard identity protocols.

The system employs artificial intelligence and deep learning algorithms to process identity checks across an international database. 

It can authenticate more than 16,000 types of identity documents across 220 countries in 140 languages, making it relevant for financial institutions operating across multiple jurisdictions.

Implementation and integration

Both solutions are accessible via API integration, allowing banks and payment providers to embed these security tools directly into their existing systems. 

For international payment providers, the combination of account validation and biometric security provides a dual approach to fraud prevention, addressing both the payment and identity aspects of transactions.

The tools arrive as payment providers adapt to new requirements for instant transfers while maintaining security standards. 

Financial institutions can implement these solutions alongside existing infrastructure, enabling them to meet emerging regulatory requirements across different markets.

Global expansion

LSEG Risk Intelligence's initial rollout across 22 countries marks the first phase of a broader international deployment. 

The planned expansion to cover 80% of G20 nations indicates the scale of the initiative, though specific timelines for this growth remain unconfirmed.

For payment service providers operating across borders, these tools offer standardised security protocols that work within multiple regulatory frameworks. 

The systems process checks in real-time, allowing institutions to maintain payment speeds while enhancing security measures.

Ramesh Menon, Group Director of Product Management for Digital Identity & Fraud at LSEG Risk Intelligence, says: “Fraudsters are constantly innovating; and operating with greater sophistication and scale than ever before. 

“As bad actors target vulnerabilities across multiple points of the client and vendor workflows, we are continuously investing in robust, data-driven solutions to help customers mitigate global payments and identity risk with greater assurance.”

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