More automation in anti-fraud efforts

[hassen1]

In response to growing fraud losses and ever increasing e-commerce volume, online sellers are turning to tools and systems that will automate and streamline fraud-management. Overall, the use of anti-fraud tools grew 14 percent from 4.2 to 4.8 tools used per merchant. The largest bussineses, those selling more than $100 million online annually, average nearly eight tools.

Almost every tool the survey addressed showed an increase in use (where comparative data is available). Those showing the greatest increase include positive lists (10 point increase to 21 percent), order velocity monitoring (10 point increase to 33 percent), IP geolocation (10 point increase to 35 percent) and company-specific fraud screens (10 point increase to 38 percent).

Positive lists are "known good" customers; order velocity monitoring assesses purchases over time by product, total dollar amount, frequency, product mix and similar measures; IP geolocation tests evaluate the risk of an e-commerce transaction based on the "electronic address" of the purchaser as compared to other geographic data supplied with the order.

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One of the big headaches today is the click fraud . Ever since the beginning of pay per click advertising, click fraud was always a possibility. But nobody ever thought it would become the problem that it is. The amount of click fraud is hard to calculate. Search engines know it goes on but because of the vastness of the Internet there is no way to get an accurate handle on it.One common practice, especially among rival companies, is to click on the rival company's ad a number of times to drive up the ad costs for the company, This is blatant fraud and is discovered by checking the IP addresses of the people clicking on the ads.