This is an interesting example of financial institutions coming together with government security operations to reduce the incidences of money laundering and corruption arising from fake identities. Obviously, it will be impossible to stop all fraudsters but more checks we have, the bigger the chances of catching these chaps out. This is also an example of what I was referring before to about financial institutions working closely with the government.
UK financial services firms are saving hundreds of thousands of pounds a year by using a passport validation service to screen and security check their customers, according to a Financial Times report.
Reports first surfaced in 2005 that the UK's passport office was working with Abbey and HSBC to set up a service that willl enable banks to cross-reference passport details with information held in the passport database. Although the Data Protection Act prevents the passport service handing out data, banks are now able to use a call centre to check passport details provided by customers.
James Hall, the chief executive of the Identity and Passport Service, told the FT that the service has now been running for one year and has been a success. Firms regulated by the Financial Services Authority (FSA) are able check and validate passports provided by customers by calling a special hotline.
In one case, a check on a customer applying for a business loan from a bank showed the passport had been forged, even though the customer had passed other checks, says Hall.
Several arrests have been made and 211 forged or stolen passports have been seized, he adds.
The service is a precursor to the sort of customer checks that the national ID cards will be eventually be used for, says the FT.
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