Aversafe Meets Global Market Needs
[Summary: International market statistics demonstrate that the costs of credential fraud are meteoric and on the rise. The world is more than ready for a tailor-made solution, and Aversafe is here to provide one.]
There’s no denying that fraud is a booming business. A 2017 report from the Javelin Research group found that in 2016, identity fraud cost consumers in the United States a whopping $16 billion USD — a mere drop in the bucket compared to the country’s estimated $600 billion in annual fraud-related business losses. As daunting as these numbers seem, they pale in comparison to comparable estimates from the developing world.
Given the vast quantities of cash in question, its no surprise that droves of blockchain startups have risen up to provide identity management and authentication services for fraud afflicted individuals and businesses. While these companies certainly deserve credit for bringing the security and transparency of blockchain to the identity space, they’ve all but unanimously failed to address what is perhaps the most common fraudulent behavior of all, credential fraud.
The Costs of Credential Fraud
While less immediately malicious than identity theft or cash larceny, credential fraud is responsible for a hefty financial footprint of its own. The US Department of Labor reports that credential fraud — typically in the form of forged certifications and doctored CVs — costs companies an average of $40,000 per bad hire. On top of the funds lost to severance pay and wasted onboarding efforts, Forbes reports that the typical cost of replacing a single dishonest employee is around 21% of their annual salary — a statistic which certainly helps to explain the $3 billion businesses spend on employee background checks each year.
Consider that a survey conducted by the US Bureau of Labor Statistics found that over a 30-year period, the average individual will change jobs 11.7 times. Given the world’s estimated 3.4 billion current employees we can conservatively anticipate more than 40 billion job changes in the next 30 years. Even if as little as half of the employers involved decide to protect themselves by vetting potential candidates, we’re still looking at billions of individual background checks. Coupled with a disconcerting increase in the number of diploma mills and unaccredited universities issuing fake degrees, there’s every indication that the costs of credential fraud will continue to rise in the years to come.
Of course, the costs of credential fraud aren’t just financial in nature. In 2010, the Australian Department of Immigration and Citizenship conducted a large-scale investigation on international students using falsified qualifications to obtain residency status with ill-gotten student visas. Meanwhile, in most cases the real victims of credential fraud are international students themselves. NAFSA, a non-profit association for international educators, reports that a credential fraud ring based in Nigeria prompted Kent State University in Ohio to stop processing Nigerian applications all together.
Unwilling to allow a handful of bad actors to justify discrimination, several prominent universities have moved towards digital credential verification. While efforts by the likes of Stanford, MIT, and the University of Chicago are definitely a step in the right direction, their credential verification systems are stymied by jurisdictional issues and a lack of interoperability with other institutions. Moreover, these universities’ systems typically involve centralized databases that continue to expose both graduates’ and current students’ sensitive information to unnecessary risk.
It seems clear that for employers, educational institutions and everyday individuals seeking educational and professional opportunities, credential fraud is a serious issue. To date, the problem has proven too complex and touched on too many parties spread across too many locations for any market-ready solution to address — until now.
Engineering a Global Solution
Aversafe connects all of the major players affected by diploma mills and falsified credentials on one blockchain backed network, providing a set of social and financial benefits uniquely tailored to meet each party’s specific trust-related needs.
University applicants and job seekers benefit from verified digital credentials that radically improve their educational and career prospects. Educational institutions and certificate providers benefit from rapid and permanent credential issuance while eliminating the costs and manual effort involved in re-verifying historic claims. Meanwhile, employers can establish trust with job applicants before the first interview, streamlining the hiring process and saving vast sums on HR activities. Finally, each of the major players gains an opportunity to generate revenue by verifying other users’ claims on the Aversafe network. All of this is accomplished while protecting each users’ personal information by adhering to a fully decentralized network model that’s globally accessible and friction free.
With global fraud statistics and employment data indicating a steady rise in the social and financial costs of diploma mills and fraudulent credentials, it seems clear that the market is in dire need of a solution. With Aversafe, it has one.