eCommerce – Fraud

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This document discusses ecommerce fraud prevention. It begins with an introduction to Paul Young, a CPA and expert in risk management, reporting, and financial solutions. The agenda outlines that it will provide an ecommerce diagram and discuss solutions for businesses. It then shares an ecommerce diagram. The bulk of the document discusses online fraud trends, citing a report on the growing fraud detection and prevention market. It outlines three common types of fraud prevention solutions for ecommerce businesses: basic gateway filters, manual transaction review, and automated solutions.

Technology

ECOMMERCE – FRAUD
PAUL YOUNG CPA, CGA
MAY 14, 2017

PAUL YOUNG - BIO
• CPA, CGA
• Financial Solutions
• SME – Risk Management
• SME – Close, Consolidate and Reporting
• SME – Public Policy
• SME – Financial Solutions
• SME – Supply Chain Management
Contact information:
Paul_Young_CGA@Hotmail.com

AGENDA
• Diagram – eCommerce
• Solutions for businesses

ONLINE FRAUD
• http://www.marketsandmarkets.com/PressReleases/fraud-detection-prevention.asp
The report "Fraud Detection and Prevention Market by Solution
(Fraud Analytics and Authentication), Application Areas
(Insurance Claims, Money Laundering, Electronic Payment),
Service (Professional and Managed), End-User, Vertical - Global
Forecast to 2021", The FDP market size is estimated to grow from
USD 14.36 Billion in 2016 to USD 33.19 Billion by 2021, at an
estimated CAGR of 18.2%. The FDP solution provide strong defense
against fraudulent activities and properly safeguarded from internal
and external threats. As the frequency of sophisticated fraud attacks
on enterprises is growing, the market is expected to gain traction in
the next five years.

TYPES OF SOLUTIONS / FRAUD PREVENTION
Source - https://www.entrepreneur.com/article/294100
1. Turn on gateway fraud filters.
Most payment gateways allow ecommerce merchants to set up some basic
fraud prevention rules to block or flag transactions that may be fraudulent.
Typical examples are to decline all transactions when the billing address does
not match what the credit card company has on file (an AVS mismatch) or
excluding all transactions from specified countries.
Pros: No cost to merchants.
Cons: The selection of available rules is inadequate for merchants facing a
moderate to high amount of fraud. There is also a high risk of false declines as
the rules are not very flexible.
This step is recommended for merchants in low-risk fraud categories and
merchants that have not experienced much fraud.

TYPES OF SOLUTIONS / FRAUD PREVENTION
Source - https://www.entrepreneur.com/article/294100
2. Manual review.
Most ecommerce merchants have employees assigned to review
purchases that fall into specific risk categories, such transactions above
a specified dollar amount and/or transactions where the billing and
shipping addresses don’t match. Common manual review techniques
include using Google to find verifiable data on the purchaser, checking
social media accounts and using Google maps to see if the shipping
address appears legitimate. The average merchant reviews 26 percent
of all transactions, of which 80 percent are eventually submitted for
processing.

TYPES OF SOLUTIONS / FRAUD PREVENTION
Source - https://www.entrepreneur.com/article/294100
2. Automated Solutions
• http://www-
03.ibm.com/software/products/en/category/advanced-fraud-
protection
• https://www-01.ibm.com/common/ssi/cgi-
bin/ssialias?htmlfid=GBS03128USEN

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