Many Facebook users post photos of new big-ticket purchases such as houses, boats, and cars. Unfortunately, some of those Facebook users are being less than truthful with credit bureaus and other financial firms about their incomes and assets. And those companies are starting to examine Facebook more closely, Bloomberg reports.
CyberSource reported that such fraud cost online retailers in the U.S. some $3.5 billion in 2012, according to Bloomberg, which added that PayPal parent eBay set aside 4.1 percent of its net revenue, $580 million, to cover such losses.
The investigating companies are examining data that users make available to the public, such as status updates, check-ins, photos, photo tags, and friends, to search for irregularities.
Equifax Identity and Fraud Solutions President Rajib Roy told Bloomberg:
We are investing a lot in how we can use unstructured data that is sitting out there in social media that can help us understand a little more about identity.
If your Facebook shows that this morning you posted in Richmond, Va., and at the same time, another person with the same name and same boarding pass checked in at some other airport outside the country, something is wrong.
Braintree CEO Bill Ready added:
I think consumers have consistently traded information for convenience. When you start using it to lend and extend credit, that’s where you start getting into privacy concerns.
Facebook has always made it so you have to be a real person, so start with that as a base. All of the richness about the things people do — that’s hard to re-create. If you have hundreds of friends on Facebook who have existed for many years, fraudsters would have had to start many years ago and collaborate with hundreds of people.
Readers: Do you think the investigating companies are within their rights to tap into social networks as long as the data they access is publicly available?