The World Cup of Fraud
By David Britton
The World Cup “kicks” off this week in Brazil and is a tremendous business opportunity for merchants around the world to sell merchandise, apps, tickets and even the caxirola – this year’s version of the Vuvuzela. This opens the doors for cross-border business transactions and as the doors open for more business, they also open for fraudsters to take advantage of cracks in the system or unsuspecting shoppers.
Businesses should remember that the Internet was never designed with security in mind, and that it also affords great anonymity, regardless of the locale of the buyer. International ecommerce studies have shown that ecommerce cross-border fraud can be 7 times higher than fraud within your own country. The anonymity of the Internet allows fraudsters to extend their reach to do damage – and to do so with greater confidence than they might in their own country.
Here are some fraud tips for businesses to consider with cross-border ecommerce:
- Marketing budgets are typically 15% of total costs and requiretime to plan – don’t let those efforts get hurt by your fraud system. The marketing team needs to work closely with the fraud team.
- Share those marketing goals with your fraud team so they are aware of marketing projects. Are campaigns on mobile, is there a special sale, package, promotions, gift card, etc. The fraud team needs to know what is out there.
- Know your target international market to help recognize fraud outliers.
- Know ahead of time what the measured attack rate is against your business.
- Have appropriate countermeasures and business rules in place when attacks surface. High risk products require a different strategy than low risk products.
- Have good data from within your business to understand the threat and to be ready to change course rapidly based on that data.
- There is also a major shift occurring in the mobile environment where users are rapidly adopting the practice of both perusing and shopping from their pocket-based devices. This shift includes fraud.
More credit cards available on the underground than ever before. Estimates put the total number of compromised identities at over 1 billion records over the past 2 years, many of which include credit card information. Combine this information with the fact that the card issuers, for cost reasons do not proactively re-issue new cards – it is up to the merchants to be extra diligent when it comes to looking for fraud.
Because the data breaches do not just divulge card data, but also the personal identity data elements of the victims, the fraudsters are able to create transactions that look very legitimate. Merchants must employ technologies that allow them to see beyond the data presented by the user, to the data about the device that is transmitting that data, in order to have real visibility into the transaction. The data may be completely legitimate; it just may not belong to the person using it.
Conversely, this same insight and capability can allow merchants to safely expand into new geographic markets, by allowing legitimate international transactions, without disruption, and without requiring an army of personnel to do the investigative work.
Companies like 41st Parameter, a part ofExperian, have spent a decade perfecting the art of how to detect the fraudster in the online anonymous environment. See how we can help bolster your business defenses, while allowing your business to grow safely into new regions – and take advantage of the millions of customers that might have a hankering for your products.