Having screened over 4.2 million applications in its first 24 months of operation, CTOS IDGuard, Malaysia and Southeast Asia’s first application fraud bureau, has detected and prevented fraudulent credit applications to the tune of RM193 million in latest figures released recently.

Over the last two years Malaysia has seen a proliferation of online services that provide customers with the convenience to apply for financial products digitally. This has also heightened the risk for the financial services industry given that traditional in-person biometric verification is no longer possible in the online space. Apart from other recent solutions to aid in the fintech space, such as implementing CTOS eKYC for the digital verification of customers’ identity, CTOS IDGuard serves as an additional safeguard against potential fraud.

The fraud bureau works by scanning credit applications in real time and checking them against CTOS’s extensive database, as well as against every application made through all partner banks in the system. With the addition of analytics and machine learning, CTOS IDGuard is then in the best position to identify any potential fraudulent behaviour and bring it to the attention of banking partners.

“As the region’s first application fraud bureau, CTOS IDGuard is pioneering new ground in the battle against credit application fraud through data, analytics and innovation through the benefits of machine learning,” commented Erick Hamburger, Group CEO of CTOS Digital Berhad. “Currently the credit providers using CTOS IDGuard to scan applications hold more than two thirds of the total banking assets in Malaysia. With access to real time, accurate, shared data, we are empowering financial institutions to recognize fraudulent applications instantly, so that the consumers that deserve credit, get it as quickly and cheaply as possible.”

CTOS IDGuard is currently being used by major Malaysian financial institutions, including Maybank, RHB, CIMB, Alliance Bank, Hong Leong Bank, AmBank and BMW Financial Services, while further banks are in the midst of adopting the system and other major financial institutions are also showing interest.

CTOS IDGuard uses an industry leading fraud and financial crime prevention engine by GBG. The system undergoes constant advancements, such as machine learning, which is due to be included imminently, to substantially increase the system’s effectiveness in fraud detection accuracy, lower false positive rates, and improve operational efficiency.

“The goal of machine learning is to derive actionable intelligence from a range of historical and new data in real-time, uncovering implicit inconsistencies in behavior and flagging out anomalies to prevent possible fraud scenarios as quickly as possible. GBG’s award winning Machine Learning capability helps financial institutions enhance two fundamental processes – customer experience management and financial crime prevention. Reducing false positive rates is not just about streamlining internal processes and costs, but in enabling legitimate customers to onboard and continuously transact with success,” says Dev Dhiman, APAC Managing Director of GBG.


Over the past two years, CTOS IDGuard found that 4.2% of mortgage applications have been flagged potentially fraudulent or suspicious, the highest alert rate among application portfolios. This was followed by personal loan application alerts at 1.8%, credit card applications (1.3%), vehicle loan applications (0.9%), SME loans (0.7%) and other applications (0.5%).

In terms of total confirmed cases, credit card applications make up the significant majority, contributing to 44% of confirmed known fraud and suspicious applications. Interestingly, a third of all confirmed cases are generated are due to applications made by known fraudsters or syndicates, which CTOS IDGuard is able to flag by utilising the multiple pools of partner data analysed by the fraud bureau.


 CTOS, Malaysia’s largest private credit reporting agency, is a registered Credit Reporting Agency under the Credit Reporting Agencies Act 2010. Established in 1990, CTOS has over 30 years of experience in aiding credit grantors make better credit decisions. CTOS utilises information from its users and the public domain to support informed decisions and facilitate fact-based risk management when providing credit extension. CTOS delivers a complete portfolio of credit reports and value-added services and is widely used by the country’s banking and financial institutions, insurance companies, large corporations, legal firms, businesses and state and statutory bodies.

Source: CTOS PressRelease 12 Oct 2022