Skype diminishes fraud and improves compliance with Microsoft Entra Verified ID

Skype connects millions of users around the globe through voice, video, and text communication. Known for its vast user base spanning numerous countries, Skype serves key markets like the United States, Europe, and Japan. As a provider of communication services, the company must adhere to various compliance requirements, which differ significantly across regions. These requirements often involve user identity validation to prevent fraud and ensure secure communication. 

A pandemic of fraud

Over the last several years, Skype has had to contend with the surge of cybercrime rippling across Japan, particularly with fraudsters frequently targeting citizens through impersonation schemes. Laura Rueda, Principal PM Director at Skype, explains, "Japanese citizens were being targeted by fraudsters impersonating trusted businesses and governmental agencies. This social engineering led to money being stolen from customer bank accounts." To tamp down fraud and protect its citizens, the Japanese government required that digital communication companies like Skype implement Know Your Customer (KYC) procedures on an accelerated timeline. The rise in fraud, exacerbated by the COVID-19 pandemic, affected Skype's ability to deliver a great customer experience. "Fraudsters make it hard for legitimate customers to connect and engage, impacting trust between users," notes Rueda. 

With the government’s timeline looming, Skype needed a robust, scalable solution to restore user trust and comply with varying regulatory requirements. 

Putting faces to names

To address these challenges, Skype chose Microsoft Entra Verified ID for its flexibility and high trust level within the team. "Microsoft Entra Verified ID has passed numerous checks and tests and offers the flexibility to modify according to specific regulatory requirements," says Lukas Liska, Senior Project Engineer at Skype. Microsoft Entra Verified ID supports many types of identification documents from a number of countries, providing the scalability needed for global deployment.  

The company’s alliance with LexisNexis Risk Solutions played a crucial role in enhancing the identity verification and fraud prevention measures at Skype. LexisNexis Risk Solutions provided extensive coverage, an excellent management platform, and proactive live support, facilitating the swift implementation of the company’s KYC solutions. This collaboration ensured a smooth transition to a sustainable maintenance process and allowed Skype to launch several UX updates, further improving customer experience. By adhering to regulatory guidelines and employing advanced data security practices, Skype, in alliance with LexisNexis Risk Solutions, significantly bolstered its efforts to keep customer information safe and secure from misuse. 

In Japan, Skype implemented Microsoft Entra Verified ID to combat fraud by requiring users to verify their identities during the purchase process and account setup. Users must provide personal details and pictures of their ID documents for verification through the app. Once verified, the user receives a verifiable credential to be stored in their Microsoft Authenticator app. From there, users can share this credential with Skype as needed to prove their identity.  “We were able to set up and deploy Microsoft Entra Verified ID within the three-month timeline, and the solution is now fully deployed for Japanese users purchasing Skype numbers,” explains Liska. 

By electing to integrate Microsoft Entra Verified ID into its product, Skype has significantly enhanced its ability to meet regulatory requirements and improve security. “The deployment process was smooth, and we’re now planning to expand Verified ID to other markets, leveraging its flexibility to adapt to different regulatory contexts,” says Liska. 

Securing trust

Since implementing Microsoft Entra Verified ID, Skype has seen substantial benefits. Skype number fraud levels in Japan have dropped by over 90%, and the company has reduced time spent investigating fraud by half. "Verified ID has helped Skype eliminate space for fraudsters to hide their identity," Rueda highlights. This drastic reduction in fraudulent activity has improved the overall user experience, with customers facing fewer interruptions from spam and fraud. 

Additionally, Skype has been proactive in raising awareness about fraud and the importance of identity verification among its users. "Verification has become an integral part of product usage," says Rueda. “This focus on security has not only reduced fraud but also enhanced customer trust and satisfaction, reinforcing Skype's commitment to providing a secure communication platform.” 

Identifying progress

Looking ahead, Skype is committed to further enhancing its security measures and compliance capabilities. The company plans to introduce Microsoft Entra Verified ID to other markets with heightened fraud concerns, recognizing the rising threats worldwide. "The flexibility to deploy a tailored solution to any market at any moment has given us further flexibility in experimenting with new markets and products," Rueda explained. 

Skype is also exploring additional innovations, such as Face Check with Microsoft Entra Verified ID to enhance its identity verification processes with higher assurance verifications. Over the next five years, Skype envisions evolving its identity verification solution to adapt to changing market requirements and the evolving nature of fraud, ensuring a secure and trustworthy platform for all users. Liska notes, "We are looking forward to building a trust-based product where Microsoft Entra Verified ID will be a cornerstone.” 

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