Fraud Risk Management
Protection Against Online Fraud
Online fraud is more than just simply losing money or merchandise. It’s an attack. That’s why it’s important to continually protect your processes: Once a fraudster successfully breaks your barriers, he will repeat that fraud again — guaranteed. Fraud management saves you money, because every loss from fraud is at the direct expense of your profit.
And fraud is more than just a pattern. Fake identities, identity takeovers, account takeovers and friendly fraud are the most common types of fraud.
Hard Facts About Fraud Management
97of online businesses are already victims of fraud
55of internet users have already been a victim of cybercrime
2.5german online merchants lose annually due to fraud
Effective Fraud Management
What is Online Fraud?
We define fraud as any loss that is deliberately inflicted on your business. This seems simple when it involves a completely fake identity. But it quickly becomes complex when identities are assumed or customers order goods without any intention of paying. Our specialty in fraud management is the prevention and defense of application and order fraud.
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What is Fraud Risk Management?
Fraud management consists of four process steps. The first is detection, which is used to identify suspicious requests, orders and transactions. The second is reaction, which typically consists of either accepting the risk, obtaining additional information, using security measures, rejecting manual checks or outright rejecting the order. Suspicious orders are checked manually in the investigation department, which is the third process. Subsequently, existing failures are checked and detected cases of fraud are included in the detection (dark field analysis). The aim of the entire fraud prevention process is to reduce costs caused by fraud. Therefore, the optimization does not only include the reduction of failures, but also takes into account costs for data and fraud management software, changes in the closing rate and fraud follow-up costs.
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Challenges to your Fraud Management
Account takeover (ATO) refers to the abuse of an existing customer account by a fraudster. The access data is usually exploited by phishing, malware or data theft. Customer profiles and the analysis of user behavior are essential in the prevention of ATO.
The use of completely fake identities is slowly declining: Identity theft has become easy for fraudsters and often promises better results. However, if the processes of your business are not protected, offenders will choose the simplest pattern and that is to invent a new person. Defensive measures are mainly the recognition of fraudulently used resources, but plausibility and pattern recognition are also used.
The trend toward identity fraud is increasing — in some cases, the identity of an innocent person is misused in more than half of the crimes detected. This is particularly critical, as it means that not only are the providers victims, but good customers become victims, as well. The thoughtless rejection or persecution of victims is a social problem and can lead to considerable loss of reputation. The protection of victims is of particular concern to us. This modus operandi is particularly critical and frequent among financial service providers. In the defense against identity fraud, the reactions of your fraud management to a suspected case of fraud are particularly important.
Friendly Fraud: When Customers Cheat
Incorrect returns, allegedly not receiving packages, returning used clothing and the abuse of benefit programs — these issues are more than just nuisances. They are types of friendly fraud. The damage from friendly fraud sometimes exceeds the volume of other cases of abuse. But often there is no sense of guilt. Even more difficult: What if good customers suddenly show such abnormalities? Pattern recognition and the control of reactions are the decisive factors in the prevention of friendly fraud.
Family Fraud: Data Abuse in the Family
Family fraud is on the rise and it’s a particularly sensitive topic, as the disclosure of family fraud reveals customers’ family problems. Family fraud is often easy to identify but difficult to prove. The use of device fingerprinting is extremely helpful in this regard. The reactions to the suspected case are critical, as part of the goal is to retain the good customers behind the fraud case.
Commercial, Corporate and Shell Fraud
Fraud by companies is similar in scope to fraud in the retail business. The cases are less frequent, but the losses are much higher. Fraud in the B2B world is often considered a one-off case and the total losses are underestimated. Only a few companies with business customers have an adequate fraud management. The critical gap has long been exploited by organized fraudsters. We can examine your processes and show you how you can protect yourself.
We Protect These Industries Every Day
An Overview of Our Products
FRIDA is the intelligent all in one solution in the prevention of online fraud
It delivers reliable results in real time by using modern machine learning algorithms to establish connections between transaction data and recognize patterns. Man and machine — the dream team for online fraud prevention.
Fraud detection through the most used form of fraud prevention: device fingerprinting
Every device leaves digital traces on the internet, similar to a fingerprint in the real world. Device Ident recognizes fraudulent devices and prevents impending damage.