Using Device Insight to Balance Fraud Prevention and Customer Experience
Today, your customer’s device has become their proxy for a large percentage of their online retail and banking activity. By using insight from those devices, you can reduce risk and ensure a smooth experience along the entire customer journey.
In this webinar, you’ll learn from Max Anhoury, our VP of Global partnerships, about:
* Today’s fraud and security trends
* What a fraud ring looks like
* The evolving online experience with EMV
* How to create frictionless security across the consumer journey
3. 3
IOVATION INC.
SOLUTIONS: Authentication and Fraud Prevention
CUSTOMERS:450+, 6 Continents, 18 Time Zones
FOUNDED: 2004
CUSTOMERRETENTION: 96%
HEADQUARTERS: Portland, Oregon
EMPLOYEES: 125
INVESTORS: Intel Capital, Sapphire Ventures
COMMUNITY: 3,500 Fraud Professionals
TOTAL TRANSACTIONS: 20B
BRANDS PROTECTED:1,500+
4. 4
Every device tells a story.
What stories do you care about?
Am I authorized for
this account?
Where am I located?
Do I have a fraud history?
What other devices does
this consumer have?
How many accounts
have I accessed?
Am I hiding from
detection?
5. 5
If a device can connect to the internet,
we can recognize it.
6. 6
Which device is this?
Is it associated with bad devices?
Are there real time risk indicators?
Is it associated with abuse?
DEEP DEVICE INTELLIGENCE:
BEYOND DEVICE RECOGNITION
9. 9
Ø 150 transactions
Ø 50 Transactions
Ø 20 transactions
Ø 10 transactions
✪
✪
¤
¤
AT 30 , 0 0 0 F T, THE F RAUD RING L OOKS L IKE THIS
10. 10
T H E T R E N D OF T R A N SA C T ION A C T IV IT Y OV E R T IME
0
10
20
30
40
50
60
15 16 17 18 19 20 21 22 23 24 25
TransactionCount
Week
Credit Bureaus
Financial Institutions
Retail
Other
actual activity noted with dashed lines
11. 11
Results of activity over 4 months
• Searched for devices matching this profile:
• Devices with activity with 3 or more subscribers
• 2 of 3 subscribers within financial services industry
• Devices with fraud histories from at least 2 subscribers
2K+
ACTIVE DEVICES
100K+
TRANSACTIONS
50K
ACCOUNTS
Performing Involving
$
Step 1: Search existing fraud activity
12. 12
Step 2: Review account and transaction velocity
Count of
Devices
Average
Accounts
Accessed
Average Total
Transactions
Average
Subscriber
Count
% with Credit
Bureau
Activity
All Devices Profiled 2,126 23 47 9 43%
20+ Accounts Accessed 880 40 79 12 55%
Highest was 259 accts
accessed by single device
100+ Total Transactions 211 64 165 15 66%
2 devices had over 1,300
transactions attempted
+10 Transactions/ Day 61 29 89 7 37%
Highest trans/day was 659
(21 trans. in 44 minutes)
13. 13
Step 3: Associate devices & activity using data from our
global network of our subscribers
The group expands from 50k to 300k accounts
~16K+
ACTIVE DEVICES
~670K+
TRANSACTIONS
~300K
ACCOUNTS
Performing Involving
$
14. 14
• This device is associated with 13 additional devices through common account access.
• Then we reviewed the prior history to understand the connected activity.
Step 4: Investigate details on an individual device
15. 15
• The 28 new account apps from Riverside were across 8 subscribers, demonstrating the effort
taken to monetize stolen credentials.
• Additional activity not accounted for above:
3 Credit Report access attempts from another Riverside address on 4/27
2 Credit Card Apps and 3 Login attempts from Whittier, CA (near Whittier College) on 5/17
4 Credit Card Apps and 18 Credit Report access attempts from a T-Mobile cell connection
Subscriber Industry Transaction Type Riverside, CA Mira Loma, CA
Univ of California –
Riverside
Totals
Financial Services
New Acct Application
Online Account Login
28
28
5
1
1
34
29
Credit Reporting Agency Access Attempt 227 9 14 250
Retail Purchase 2 14 16
Telecommunications Online Account Login 1 1
Travel Purchase 2 2
Device Activity
Step 5: compile fraud activity by location
16. 16
Ø 150 transactions
Ø 50 Transactions
Ø 20 transactions
Ø 10 transactions
✪
✪
¤
¤
AT 30 , 0 0 0 F T, THE F RAUD RING L OOKS L IKE THIS
17. 17
T H E T R E N D OF T R A N SA C T ION A C T IV IT Y OV E R T IME
0
10
20
30
40
50
60
15 16 17 18 19 20 21 22 23 24 25
TransactionCount
Week
Credit Bureaus
Financial Institutions
Retail
Other
actual activity noted with dashed lines
21. 21
Record high for data
breaches
TARGET
EBAY
ADOBESONY
70M 10M
145M
152M
1.32 BILLION
RECORDS EXPOSED
IDENTITY THEFT RESOURCE CENTER
HOME DEPOT
56M MySpace
Tumblr
Fling
LinkedIn
642M
22. 22
DATA
BREACHES
$5B in 2014
$8B in 2018
Data breaches will drive a 60%
increase in Account Takeover
and New Account Fraud.
60%
SOURCE: JAVELIN, 2015
INCREASE
29. 29
LOGIN
CHANGE
ACCOUNTDETAILS
ADD ITEMS
TO SHOPPING CART
REDEEM
REWARDS POINTS
Your customers expect a frictionless user experience
across multiple channels: web, mobile web, mobile app
ACCOUNT
CREATION
PURCHASEVIEW
ORDER
BROWSE
CATALOG
Your business depends on happy customers balanced with
minimizing fraud risks and security
TYPICAL CONSUMER JOURNEY FOR ONLINE RETAIL
31. 31
LOGIN
CHANGE
ACCOUNTDETAILS
ADD ITEMS
TO SHOPPING CART
REDEEM
REWARDS POINTS
ACCOUNT
CREATION
PURCHASEVIEW
ORDER
BROWSE
CATALOG
Your business depends on happy customers balanced with
minimizing fraud risks and security
Device Intelligence can help
achieve this balance
Your customers expect a frictionless user experience
across multiple channels: web, mobile web, mobile app
33. 33
The benefit of using device intelligence
across the consumer online journey
34. 34
Concerns:
Fraud prevention: 1st or 3rd party
account creation fraud
Device Intelligence Indicators
• High velocity rate
• Previous associated fraud evidence
• Geo-location
• Device evasion
• History of device
Application
Origination
35. 35
Application
Origination
“Since we deployed iovation, we have
experienced dramatically lower fraud
losses resulting from the online credit
card application channel.”
-- CristinaKoder,
Fraud Operations Supervisor
Significant reduction in fraudulent credit applications
iovation helped:
n Link fraudulent devices and accounts together
n Determine real location vs stated location
Case Study: Financial Services
Challenges:
n Fraudsters applying for credit with stolen identity
n Risky transactions coming from multiple
geographies
37. 37
PASSWORD-BASED
AUTHENTICATION
STEP UP
1-Factor Experience & 2-Factor Security
Users expect a low-friction authentication experience for most logins.
Interacting with a 2nd
factor of authentication is not low-friction.
1-FACTOR 2-FACTOR
Desired User Experience Required Security
38. 38
Concerns:
n Stolen payment credentials
n International fraud rings
n Chargebacks
Device Intelligence Indicators
n High velocity rate
n Links to other accounts and devices
n Previous associated fraud evidence
n Geo-location
n Device evasion
n History of device
Guest
Checkout
39. 39
“iovation’s device reputation
technology adds an incredibly
important layer of protection
to our fraud efforts”
-- Fraud Manager
reduction in order fraud
n iovation helped:
n Find and link previously unrelated accounts & devices
n Reduce manual reviews
n Identify & stop high-risk transactions
Case Study:
Electronics Retailer
n Challenges:
n Fraudsters constantly evolve new techniques to escape
detection
n Stolen payment credentials
n Hard to shut down international fraud rings
Guest
Checkout
25%
48. 48
ANNUAL F RAUD F ORCE SUMMIT
R EGISTER @ www.fraudforcesummit.com
U S E P R O M O C O D E ‘ w e b i n a r 1 0 0 ’ T O S A V E $ 1 0 0
K E Y N O T E SPE AK E R :
THERESA PAYTON
FORMER WHITE HOUSE CIO