Equifax Targets Fraud Amid 13% Jump in Mortgage Revenue

Equifax is preparing to launch new fraud prevention tools amid an uptick in mortgage revenues.

The credit bureau company on Tuesday (Oct. 21) released earnings showing a 7% increase in revenue, despite what it called headwinds from the U.S. hiring and mortgage markets.

Mortgage revenues alone were up 13%, “despite decline in underlying mortgage market,” as the company said in its earnings release.

Speaking during an earnings call, management spotlighted efforts to use artificial intelligence (AI) tools to combat fraud, specifically the increase in synthetic and first-party fraud.

“Fraud remains one of the most significant and rapidly evolving threats our customers face,” said Mark Begor, Equifax’s CEO. “We are leveraging our new advanced AI capabilities and unique data assets to deliver a new generation of fraud prevention tools that can identify risks that are invisible to traditional methods.”

Among the new offerings is a synthetic identity model that analyzes billions of non-traditional data points to detect “ghost identities.” Equifax also plans to deploy a new first-party fraud model designed to uncover behavioral patterns that suggest a consumer has taken out credit with no intention of repayment.

As PYMNTS has written, first part fraud — also known as friendly fraud — occurs when someone uses their own identity to carry out dishonest acts for financial gain. It is by some estimates a $100 billion problem.

Other examples of first-party fraud/friendly fraud include people disputing legitimate ATM withdrawals or debit or credit card transactions for goods they had no intention of paying for.

Elsewhere on the call, the company said consumer lending remains stable, though softer than peak levels. Equifax saw strong growth in non-mortgage verticals, with consumer lending revenue soaring 20% in the quarter, reflecting broad-based double-digit growth in auto, personal loans, and card markets.

In other Equifax news, the company last week debuted Equifax Ignite AI Advisor, a generative AI solution that helps lenders analyze portfolio performance, spot growth opportunities, and improve decision making via conversational data insights.

“Built on the Equifax Cloud and powered by its Amplify AI engine, the tool merges lenders’ internal data with Equifax’s proprietary credit and risk analytics,” PYMNTS wrote. “It allows financial institutions of all sizes to interact with data through natural language queries and visual dashboards, without requiring advanced technical expertise or dedicated data science teams.”

Industry peers are taking similar measures to strengthen AI reliability. As covered here, FICO has introduced tools to prevent generative AI hallucinations, part of a rising movement to improve accuracy and compliance in financial AI systems.