Can Blockchain Technology Protect Seniors from Cyberscammers?
According to the FBI, cyberfraud costs older Americans more than $4 billion a year, much of it originating in telephone scammers. A ‘digital’ identification system could make a big difference, says the founder of a leading commercial tech firm.
Landwebs
Did you hear the one about the 80-year old Pennsylvania woman who paid $25,000 in taxes on lottery winnings for a lottery that never existed? Or the senior who lost $250,000 to psychic scams?
How about the concerned grandpa who posted bail money for his grandson who was never arrested?
All these frauds began with a telephone call from a scammer.
Scams of all types and sizes —disguised as romance, tech support, lottery and sweepstakes, government impersonation and plain old extortion — are victimizing thousands of innocent victims, and our grandparents are prime targets.
In 2020 alone, older Americans lost more than $4 billion a year to scams and abuses, according to the FBI. But since many victims are too embarrassed to report their misfortune, some experts say the number could be 30 or even 40 times higher.
The problem is getting worse, despite well-meaning legislation designed to protect seniors from charlatans and evildoers.
Nobody likes the idea of our most vulnerable citizens being cheated out of their life savings. Legislation designed to protect our seniors from cyberfraud is working its way across Capitol Hill.
The legislation is welcome, but new laws are unlikely to provide a lasting solution. Bad actors will always find new ways to outsmart the system.
The senior scam crisis is a direct result of a growing barrage of unwanted calls that plague not just seniors, but all Americans. And the solution, I believe the answer lies in using technology to shield the primary point of contact for scammers: the telephone.
Our phone numbers are the most common unique identifiers in our digital world. The vast majority (89 percent) of seniors receive at least one robocall per week according to Transaction Network Services, a commercial firm which provides what it calls “industry-leading” protection against spam calls.
More than half (about 56 percent) receive at least seven robocalls per week.
The Federal Communications Commission (FCC) has tried multiple ways over the decades to crack down on their number-one consumer complaint – illegal and spoofed robocalls. But the problem has only grown worse.
A Silver Bullet
Yet there’s a silver bullet on the horizon: a digital identity solution powered by blockchain.
Many people cringe at the term “blockchain,” since it sounds like something from a distant galaxy. But blockchain and its sister solution – distributed ledger technology (DLT) – hold the key to protecting our digital identity now and in the future.
An identity solution enables customers to be confident that the communications between them and the brands they choose is consensual and can be trusted.
The demand for self-sovereign identity is what seniors and the rest of us need to be safeguarded from fraudsters incessantly trying to break down our front door. With a digital (DLT or SSI) identity solution, enterprises and consumers can claim and maintain the identity associated with their phone numbers.
By creating a digital identity and giving permission to trusted parties, enterprises avoid the inefficiencies from creating and duplicating the same information with multiple communication providers and independent databases.
Storing an immutable record of consented communications enables consumers and brands to communicate through a set of trusted, digitized identity credentials.
Plus, the same path to trusted calls and texts can drastically reduce the operational costs for telephone companies struggling to monitor and mitigate fraud.
Blockchain technology enables seniors to answer a call or text from companies they want to do business with, and to be confident that the communication is indeed legitimate.
Noah Rafalko
Scams and abuses won’t disappear because a new law has been passed. Telecommunications carriers need to investigate innovative new solutions that will make it easier to protect the innocent, starting with blockchain technology.
The company I founded, TSG Global, is using that technology successfully.
I’m confident it will prove to be the most effective way to severely curtail the predators targeting our most vulnerable citizens.
Noah Rafalko is founder and CEO of TSG Global, Inc. which provides voice, messaging and identity management services for SaaS companies and large enterprises.
