Preventing ID Fraud For Banks & Credit Unions

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The following post is provided by IDScan, a MeridianLink^® Marketplace partner.

Despite the growing emphasis on digital transformation in banking, physical branches remain a cornerstone of client service-especially for high-value transactions and VIP clients. Yet, while digital channels are often fortified with advanced identity verification tools, many account origination desks and teller lines are still vulnerable to outdated, manual ID checks.

For financial institutions using MeridianLink^®, integrating E-Seek M500 ID scanners with ParseLink offers a powerful way to bring advanced fraud prevention into the branch-right at the point of interaction.

The fraudsters haven't left the building

Check fraud, account takeovers, and identity spoofing are not limited to online activity. In fact, in-person fraud is thriving.

Criminals frequently walk into banks armed with expertly forged IDs or real IDs obtained through theft. They impersonate account holders, often with enough personal detail to seem convincing. Some even take the time to study consumer behaviors, using attire, speech, and demeanor to better mimic legitimate clients.

These tactics are increasingly common, and financial institutions across the country are feeling the impact:

• In November 2024, a woman was arrested in Grand Island, Nebraska, after attempting to obtain a $40,000 loan from Trius Credit Union using a fake Missouri driver's license and a falsified Social Security card. Upon investigation, authorities discovered she possessed multiple credit and debit cards under various names. She faced charges including criminal impersonation and theft by deception.

• In March 2025, a man in Ohio used a fake ID to make cash withdrawals and cashier's checks at two bank branches. The fake ID had his photo but someone else's personal information.

In-person fraud continues to plague FIs of all sizes. And the use of fake or forged identity documents is at the heart of it.

Modern tools to thwart the modern fraudster

Traditional ID checks-whether by visual inspection or barcode scanning alone-are no match for today's sophisticated forgeries. That's why more financial institutions are turning to document authentication as a standard part of in-branch client verification.

For institutions using MeridianLink, the combination of E-Seek M500 hardware and ParseLink software provides a frictionless way to verify identities and feed accurate data directly into their LOS or account origination systems.

Visual ID inspection-relying on a teller, banker, or security officer to manually assess an ID's validity-is inherently limited. Even experienced staff can only detect the most obvious signs of tampering or forgery, and counterfeiters are constantly improving their methods. High-quality fake IDs often replicate surface-level details like holograms, fonts, and barcodes convincingly enough to fool the human eye. Additionally, FI employees under time pressure or distracted by client interaction may miss subtle indicators of fraud. Visual inspection also fails to detect internal inconsistencies, such as mismatched data between the barcode and printed fields, or invalid formatting that violates official ID templates.

How ParseLink works to stop fraud & parse data into MeridianLink

Document authentication technology, by contrast, offers a forensic approach to ID verification. Devices like the E-Seek M500 use multiple wavelengths of light (including infrared and ultraviolet) to analyze embedded security features invisible to the naked eye. When paired with authentication software, these systems validate the ID against known templates, check for pixel-level tampering, and ensure all data fields are structurally correct and consistent. They can catch over 95% of fake IDs in under 10 seconds-far outperforming any manual process.

If the ID is determined to be legitimate and authentic, the software rapidly parses all the information directly into the MeridianLink software - 100% accurate, clean data - eliminating the need for manual data entry, or photocopying of the ID.

Importance of In-Branch Fraud Prevention

While digital channels are often the focus of fraud prevention efforts, in-branch fraud remains a critical area of concern. Implementing robust identity verification and authentication measures in physical branches is essential to mitigate risks associated with fraudulent activities. By adopting a multi-layered approach to fraud prevention that includes both digital and in-branch strategies, financial institutions can better protect themselves and their clients from the growing threat of fraud.

MeridianLink consumers can learn more by contacting their MeridianLink account rep or visiting the dedicated IDScan.net landing page.