Xigem Technologies (CSE:XIGM, OTCQB:XIGMF) Corporation has described to investors how its wholly-owned Cylix Data Corporation subsidiary has helped numerous clients to mitigate serious instances of fraud through the effective use of its business intelligence platform.
With the rapid migration of critical commercial relations to the cloud, the Toronto, Ontario-based technology provider said the proactive detection of potential and actual fraud has become a mission-critical necessity for businesses.
“Cylix's business intelligence platform is designed to help its customers manage multiple types of risk relating to partners, alliances and their supply chain,” Xigem said in a statement. “Among the most important risk consideration is the identification of fraudulent activity including but not limited to misrepresentation of one's identity, location, assets or even the nature of its operations."
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Xigem noted that, according to a worldwide study by the Association of Certified Fraud Examiners, organizations can expect to lose 5% of their revenue to fraud. The typical fraud case results in a median loss of US$125,000 and takes 14 months to detect.
The company said the remote economy has resulted in an increasing number of commercial relationships and transactions existing online, often between parties in distant locations, relying on only the integrity of the business data which they collect.
In comparison to traditional in-person interactions, new digital relationships are more susceptible to fraudulent activities by bad actors, it added.
“Cylix will often take the guesswork out of when, where and between whom transactions should take place,” Xigem said.
The company provided a few examples, with identifying information removed, of actual instances where Cylix's customers successfully mitigated fraudulent activity thanks to its proprietary technology:
- A manufacturer had considered procuring materials from a new vendor until Cylix revealed that the vendor existed only through a false online identity.
- A distributor was preparing to fulfill an order from an existing customer. Before completing the sale, the distributor ran a Cylix check to discover that the individual placing the order was not authorized to do so on behalf of its customer with the likely intention of diverting resources for personal gain.
- A manufacturer was preparing to sell to a new customer when a Cylix query which included a record of corporate officers and directors, uncovered evidence that the principal had a pattern of creating multiple entities to purchase goods and services, with the sole intention of defaulting on payment without recourse.
"We work closely with our customers to develop strategies that mitigate the risk of fraud," said Mitch Kahan, chief operating officer at Cylix Data Corporation. "By cross-referencing data against multiple independent sources, our business intelligence platform can flag situations where people appear to be falsifying information. Organizations can obtain the most effective results by screening potential business partners and transactions through our platform as part of their normal routine.”
In 2021, Xigem said the Canadian Anti-Fraud Centre received 104,295 fraud reports involving over $379 million in reported losses, an increase of 130% from losses reported in 2020. It is estimated that fewer than 5% of victims file a fraud report with the CAFC, meaning the true incidence and economic impact is many times higher, the company added.
Xigem powers technology for the near trillion-dollar remote economy that businesses around the globe are embracing in a post-coronavirus pandemic economy. Its SaaS (software-as-a-service) technology platform, iAgent, provides organizations, businesses and consumers with the tools necessary to support remote working and learning.
Xigem's software improves the capacity, productivity, and overall remote operations for businesses, consumers and other organizations.
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