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8 Bad Actors Sharing Economy Platforms Need to Monitor

Everyone knows that person. You know, the one you’re not going to loan your truck for moving day, or the one who is last on your list to ask to catsit. 

Sure, some people can be flaky friends. But today we’re talking about bad actors. Bad actors are a major threat to trust and safety in the sharing economy. 

The first step in protecting your platform from bad actors is knowing what to look for. Once you realize how to efficiently and effectively screen for bad actors, you can lower your platform’s risk—and your insurance costs. 

Let’s explore 8 common types of bad actors you’re likely to encounter when screening users on your platform, and the major damage they can do to your business.

Bad actors ruin the P2P experience for everyone.

When we say “bad actors,” we don’t mean people who have caused accidents on the platform previously. We mean people who intend to commit a crime: people making a profile with someone else's license, people using a stolen credit card, and people with very relevant driving violations. 

Sometimes, it's easy to forget that bad actors exist. They might not be part of your daily life, but that doesn't mean they're not out there. Criminals actively seek out sharing platforms as easy targets for their unlawful activities. These aren't just minor inconveniences; they can lead to substantial losses, like vehicle theft, which have a direct impact on your platform's financial health.

While many founders, investors, and users love the utopian idea of a sharing economy, many more hosts and renters are nervous about the potential consequences of bad actors getting onto the platform.

You know who else hates bad actors? Insurance providers. Rather than try a holistic approach to insurance, carriers will either reject insuring the platform outright or charge an incredible amount because of the perceived high risk. Platforms are then left stuck when the cost of insurance squashes their innovation. 

It's not just that these individuals are bad for your bottom line because of claims costs. Bad actors can do catastrophic damage to your business. If they aren't covered by your platform's insurance policy, because they're not an allowed user and you didn't do your due diligence, then the entire cost of the claim could fall on you.


Common Types of Bad Actors

Navigating Here are the eight most common types of bad actors you're likely to find trying to gain access to your platform. 


DS_Campaign_2023_Q3_Blog_Bad Actors Blog  - Friendly Fraudster

The Friendly Fraudster: The bad actor with great friends

This user doesn’t have a license or has a suspended license, so they borrow a family member's or a roommate’s license for registration. Their credit card, address, phone, and documentation are all valid—except for that sticky point of it not being their actual identity.

DigiSure insight: We’ve seen siblings, a parent/child, and roommates use a loved one’s information to register on a platform—sometimes knowingly, sometimes unknowingly. But there’s often one key detail, like an email address, that doesn’t match the rest of the information.  

DS_Campaign_2023_Q3_Blog_Bad Actors Blog  - Identity Thief

The Identity Thief: The bad actor who steals identities

Criminals involved in this type of fraud purchase stolen assets, often online or from criminal networks. They employ various combinations of stolen credit cards, driver's licenses, and more, often accompanied by VOIP phone numbers, to fabricate fake accounts. 

“Some of these bad actors are very persistent—and they get very creative. We’ve flagged one user up to 40 times, and those are only the attempts we know about on the platforms that use DigiSure.”

—April Ludwig, Fraud and Risk Operations

DS_Campaign_2023_Q3_Blog_Bad Actors Blog  - McLovin

The McLovin’: The bad actor who forges documents

Some users attempt to manipulate their identity documents by using software like Photoshop or physical alterations to make the documents appear in their own name. It’s not just teenagers trying to buy beer: criminals are making fake IDs to rent from your platform, too.
DigiSure insight: Common flags that a document is forged include signatures that look like they were typed instead of written, mismatching front/back of identification, and discrepancies between the information the user entered and the information on the document. 


DS_Campaign_2023_Q3_Blog_Bad Actors Blog  - Evil Twin

The Evil Twin: The bad actor with a mismatched identity

Occasionally, a user may book a service on behalf of a family member or spouse using valid documentation without complying with the platform's specific requirements. While the usage may be with permission, it may still violate platform policies and require scrutiny. 


DS_Campaign_2023_Q3_Blog_Bad Actors Blog  - Globetrotter

The Globetrotter: The bad actor with a foreign ID 

In this instance, a user presents a driver’s license from a foreign jurisdiction but is actually a US resident. Maybe the user still hasn’t taken a driver’s test in the US… or more than likely, their US license is revoked or suspended. The number of individuals in the US who are either unlicensed or hold a foreign driver's license (FDL) has significantly increased. As many as 30% of these drivers also possess a U.S. driver's license but falsely claim to have an FDL to avoid having their motor vehicle report pulled and the subsequent discovery of any violations.

DigiSure insight: If a user presents a foreign license but has a US phone number, that’s often cause for further investigation. Any time a user registers with a foreign ID, it’s a good idea to look into it. 


DS_Campaign_2023_Q3_Blog_Bad Actors Blog  - IOU

The IOU: The bad actor who’s a credit risk

Users with valid documentation may rent services, but issues arise when they cannot cover the deductible, often around $2,000, due to existing past-due balances on their credit cards. This situation can result in increased costs for your platform if not managed effectively. 


DS_Campaign_2023_Q3_Blog_Bad Actors Blog  - Rap Sheet

The Rap Sheet: The bad actor with a criminal record

Users with previous felony convictions related to theft may book rental services using valid documentation. Such individuals could pose a risk to both the platform and other users, potentially leading to increased insurance costs.


DS_Campaign_2023_Q3_Blog_Bad Actors Blog  - Risky Business

The Risky Business: The bad actor who makes bad choices

Some users may pass all compliance checks but have a history of moving violations or engaging in risky driving behaviors, such as using handheld devices while driving. Despite passing the initial checks, these users are 2–3 times more likely to make insurance claims, potentially increasing your platform's insurance expenses.

Catch bad actors before they damage the platform experience.

“For bad actors, fraud is a business. Like any business, they want a strong return on investment. They will only invest so much time if there’s something worth getting out of it. Sharing platforms are a newer business model, so they are trying new ways to take advantage. Our job is to make the industry as a whole less interesting for bad actors.” 

—Karissa Prayogo, TrustScreen Product Manager
When we talk about bad actors in insurance, we don’t mean people who are likely to get in fender benders while renting through your platform—we’re talking about people who intend to use your platform to facilitate crimes. 

For platforms, it can feel like screening creates friction for their users and slows down the approval process, but it’s imperative to understand the value. When those details don’t align, there’s a reason. Sometimes, the user really does have a new phone number, but the worst-case scenario is it’s someone with ill intentions. That friction is vital for stopping these bad actors. 

It can be difficult to imagine, but here’s why you must take bad actors seriously and stop them from using your platform: 

  • Financial losses: When bad actors go unnoticed, you're essentially footing the bill for their deceptive behavior. Your hard-earned funds are diverted to cover the costs incurred by these individuals, be it for accidents, theft, or other fraudulent activities. 
  • Higher insurance costs: An obvious drawback of not identifying and managing bad actors is the reduction in insurance costs. By failing to weed out those who pose a risk, you increase the frequency and severity of claims, ultimately hurting insurance premiums.
  • Decreased profitability: Higher insurance costs and increased claims can directly impact your profitability. By effectively screening out bad actors, you can improve your financial health, which, in turn, fuels your ability to grow and expand. 
  • Poor customer satisfaction: Your hosts, who trust your platform, expect a seamless and secure experience. Bad actors can disrupt this harmony, leading to dissatisfaction among your host and user base. Addressing these issues is a proactive step toward increasing customer retention and satisfaction. 
  • Bad brand reputation: Staying out of the headlines for all the wrong reasons is crucial. By focusing on risk mitigation and fraud prevention, you safeguard your brand's image and maintain trust with your user base.


More amazing customers, fewer bad actors 

When it comes to onboarding new users, your screening process doesn’t cause friction—bad actors do. 

At DigiSure, we built our screening process with insurance in mind. When you partner with us, your insurance is underwritten for insurance on your platform. With TrustScreen, we help our partners secure better insurance premiums by showing carriers how they’re actively screening out bad actors. 

The unknown risk of bad actors on sharing platforms is one reason your insurance costs feel so high. Learn more about what’s driving these costs and how to control them in our guide, Navigating Insurance Costs in the Sharing Economy