Parallel Markets conducts a Public/Private Records Search as part of the individual and business verification process. The results of these searches can increase confidence that the onboarding subject legitimately exists and is providing accurate information. One such search conducted by Parallel is for a natural person’s or legal entity’s Tax Identification Number (“TIN”).
What databases are searched?
TINs are highly confidential and it is not likely that they will be found in public records searches. Therefore, Parallel’s search for TINs is focused on U.S. credit agency information. In particular, the search is designed to identify instances of credit headers where the name coupled with the TIN provided are an exact match.
What does it mean if there is a match?
When Parallel’s output reveals that a high match has been identified, you will see a message such as this one in your dashboard:
This signifies that the TIN that your customer/investor provided matches a TIN that is associated with a person with that same name in credit records and it will identify the credit agency in which the relevant record was found. This is strong evidence that the person/entity providing the information is who they say they are.
What does it mean if there are no matches?
Parallel searches for credit header data from credit agencies in the United States. Foreign Tax IDs are not verified and therefore in instances where a non US TIN has been provided, there will not be a match. If a US TIN results in no match, this may be an instance where additional analysis is warranted but could be attributable to:
- The individual has obtained a new TIN, perhaps due to being a recently naturalized U.S. citizen
- The individual has not set up any lines of credit
- The name of the individual has recently changed
- The business does not yet have a tax ID, or has a newly issued tax ID
What do multiple TIN matches mean?
In some instances, you might see the following flag in your dashboard:
The immediate reaction might be concern that someone is using a stolen TIN that actually belongs to someone else. While that is one (remote) possibility, the good news is that it is far more likely that there is a reasonable, and non-fraudulent, explanation for this flag.
How is this flag triggered?
If an individual has opened multiple accounts using names with even slight variations, this will result in the generation of this flag. So, for example, if a customer opens a credit card account by providing a first and last name and then opens a second credit card account by providing a first, middle and last name, this would result in the triggering of this flag.
Another instance that could result in multiple TIN flag is if a natural person has associated his/her personal TIN with a trust that is held under a different name. So, for example, Robert Jones may have his TIN associated with multiple credit card and utility accounts all under the identically same name, but also established the Robert Jones Family Trust using that same TIN. That could result in the triggering of this flag.
Yet another example is when an individual sets up an account on behalf of a spouse or a child and titles the account with the user’s name but with the responsible party’s TIN. So, if a mom opens a cell phone account for her son, her TIN could then be associated with her son’s name on a credit header.
All of these are non-nefarious rationales for why this flag could be triggered.
How should this flag be evaluated?
In the rare instance that this flag appears on your dashboard there are several options for how to disposition it.
If there is a high overall records match confirming the name, address and government issued ID of the person or entity being screened, it may be reasonable to clear the multiple TIN flag as a likely false positive. In this scenario, best practice would be to include a description of the analysis in written procedures that describes the low risk of a stolen identity in light of the absence of the other flags.
Another option, given the relative infrequency when this flag will trigger, is to conduct additional investigation by asking the customer for additional documentation to confirm identity – which could include proof of address, proof of TIN or an additional identity check with liveness detection. This might be a prudent practice in instances where other elements of the identity record are also unconfirmed.
Should you have any questions, Parallel’s Identity Compliance team is here to help. Feel free to reach out at help@parallelmarkets.com.