We spoke with Chris Adjei-Ampofo, Uphold’s CIO, about the relationship between the two companies, how Uphold tackles the challenges that fraud presents, and how Veriff have performed so far.
Veriff partnered with Uphold in December last year and have enjoyed an exciting partnership so far, with Uphold welcoming huge numbers of customers in the early days as they ran enticing promotions to help grow their excellent cryptocurrency platform.
We recently spoke with Chris Adjei-Ampofo, Uphold’s Chief Information Officer, about the relationship between the two companies, how Uphold tackles the challenges that fraud prevents, and how Veriff have performed so far.
Previously before becoming a CIO, I was also Chief Information Security Officer, responsible for the Security team. Now, in my new role, I have Information Security reporting to me, along with Fraud. My involvement with regards to Veriff is that I’m also Head of Procurement, and I’m the the main point of contact between Uphold and Veriff. I was responsible for the contracting, negotiations, involved in the proof of value that we did and assisted the migration into production. I now have regular meetings with Veriff and if there are any daily concerns or issues, they come to me.
We’re a cryptocurrency exchange, predominantly, but we’re also trying to diversify. It’s not just a way to trade crypto, you can actually buy other assets on our platform as well - you could buy precious metals, fractional equity, shares in Tesla, Coca-Cola, and Microsoft using portions of your crypto assets to fund the purchase of those assets. We’ve also launched our own debit card, so you can add or use your crypto as a method of day-to-day living, meaning you can go and buy a coffee, do your daily shopping, or order online, all with crypocurrency.
About 200, globally.
We have our compliance team and our fraud team - in compliance we have 10 full-time people and in fraud, it’s about 3. But we use an external outsourced agency to help us with daily monitoring of fraud and compliance.
About 2 million.
We were using a competitor of Veriff. We had serious problems with the quality of the verifications and quality of their solution. Before choosing Veriff, and as a part of proof of value, we did an A/B test - half of our customers were going through this competitor and half through Veriff. Afterwards when we ran an analysis to compare how many false-positives we were getting between the two solutions and Veriff was so much better than the competitor. We then switched to Veriff and we discontinued the service with the competitor.
It’s improved a lot. It weeds out a lot of the fraud, but obviously it can be improved. It’s a lot better than where we were.
For onboarding - we want to know who our customers are. It’s a compliance requirement, as well as preventing fraud. We’re a global company, so as the company is growing, we’re attracting a lot of attention, and we need an online ID solution that would protect us and our customers.
We have other tools in place that allow us to detect fraudulent activity, based on the individual profile, the behaviour, the location they’re coming from - and that allows us to build a profile, before they go to Veriff. We have checks at the front door, and once these clear out any potential bad actors, then we put them through IDV.
The KYC and compliance, where we’re removing a lot of the bad actors and stolen IDs. Also one of the things we recently implemented, velocity abuse, where when someone has stolen loads of IDs and they’re trying to sign up, Veriff helps us detect where they’re coming from and recognizes the repeat use of a device. The benefits of the combination of these tools allows us to reduce the fraud rate and meet our compliance regulations as well.
The accuracy of the information that people provide. The live video detection that we have is a key component of the solution that we use. One of the main things that we’ve been experiencing is social engineering, where genuine people who are not so literate with computers have been defrauded. They have a fraudster at the other end of the phone, telling them to sign up with Uphold, and they’ve never heard of Uphold, but they’ve been enticed to sign up. When those individuals realize that they’ve been defrauded, they’ll claim a chargeback with their financial institutions and we take the hit. But what Veriff has allowed us to do, is the ability to engage with defrauded customers and actually show them we have video evidence of them going through the IDV process. This has proven to be a very powerful tool to help us combat friendly fraud. We have a number of ongoing legal cases in the US where we have been able to provide the evidence that Veriff has given us as a part of the proceedings. This has been a key contributor to the success of these proceedings.
We’ve been always looking for a strategic partner, a partner who would grow together with us and who would understand the challenges we’re facing. A partner who is in regular contact with us and offering new solutions on how we could combat this fraud and Veriff has been great in doing that. That’s something that has been really key in the relationship. You are very forthcoming when new updates or features are being released - you want to get us onboard.
One of the challenges that we had is that we needed to - as a part of our business onboarding process - identify business owners themselves. When a business owner has got a /--/ ownership, we need to send them a link for them to verify themselves. And we didn’t want them to go through the selfie process, just upload a document for it to be verified, so Veriff built us a custom flow to allow us to do that. This helped a lot with the business onboarding.
Definitely, our verification success rate in the January after joining Veriff was at 78%, and that’s now grown to 87% in September (last month). In terms of growth of our verification volumes, the quarter-to-quarter growth has also increased - by 71% from Q1 to Q2, and a further 33% from Q2 to Q3. In total, 81% growth from the beginning of the year to now in terms of quarterly numbers.
We also constantly keep an eye on the false positives and their ratios, as this a crucial metric, but not something we can publicise.
The workload has decreased because we don’t have a lot of manual checks that we’re doing at the moment. But again, that’s still a work in progress because there are things that we could do to improve it. We’re probably speaking with Veriff about the margin of error. We’re looking to see how we can improve that as well.
It’s a combination of stuff. We completely rebuilt our UI and the whole user experience, the platform, the mobile app. It’s a lot easier to use. The assets that we are offering, and also some of the new products that we are offering - the debit card, fractional equities. And I guess it’s also the right time for crypto, crypto has been doing well and we have benefitted from that.
We look at the number of users, but we can have a lot of people registering, then not actually converting. We look at the people who are transacting, and we’re looking at people who are depositing. Those are the metrics that we look at - the conversion ratio from just signing up to actually transacting. Also, the size of the transactions, they are also quite a key element.
Europe. We’re quite big in the US and North America, Venezuela as well. But we need to start targeting Europe. And we’re also looking at Africa, that’s an area that we’re not so good in yet.
Our long-term vision is that we want to be a bank. You can see this in the assets that we’re already providing and our move to be a part of your day-to-day life where you can use Uphold as part of your day-to-day transactions. We want to move away from people buying crypto and leaving it to go up or down or whatever. It should be a part of your daily life - that’s what we’re trying to do.
Don’t just go for the technology itself. Look for a partner that is going to work closely together with you and grow with you. And a partner who is quite flexible and reactive to solve the challenges that you face. You know, where they can help you improve and assist in your fight against fraud. It’s very easy to buy the state-of-the-art technology, but without the support and relation behind, it just becomes a big monster and you’re only going to be using 10-15% of the ability of that product, if you don’t know how to optimize it. That’s where the key of the partnership comes into play.
Yeah, I put on my procurement hat. It’s very easy for people to invest in technology and not really look at the whole partnership.
Oh I always refer to Veriff as, and I’m being completely open, my favourite vendor. Because we have a good relationship with Veriff. Internally we appreciate the relationship we have and we have a relationship where we can be completely open. If we’re unhappy with something, we’ll tell you - from the price to the service, and how you can make it better. And that’s great. And it’s great that Veriff takes that feedback and sees how you can improve it. A lot of other vendors would say “Nah, take it or leave it”, but that hasn’t been the case with Veriff. We both appreciate the mutual benefits.