More than 3.6 million personal records, including card data, are stolen every day, according to the Breach Level Index, and fraudsters are hard at work to use that data to their advantage. The latest report from IDology highlights fraud trends, while InComm, Tender Armor and Intellicheck have announced initiatives to keep the fraudsters at bay.
More than 80 percent of organizations experienced fraud attempts within the past year, an increase from 77 percent the previous year. The financial industry was hit the hardest, with 93 percent of respondents reporting they have been the subject of fraud attempts in the past 12 months, according to a 2016 Fraud Report by IDology, an ID verification and fraud prevention technology company. The survey polled senior executives from IDology’s customer base, which includes financial services, retail, telecommunications and other consumer and business services of all sizes.
Website applications continue to be the “platform of choice” for attempted fraud, with 81 percent of respondents reporting most of the fraudulent activity occurs online, an increase from 71 percent a year ago, the report found. Although fraud attempts in the mobile channel remained the same overall at 8 percent, the financial services and retail/e-commerce sectors reported fraud attempts via mobile at 10 and 17 percent, respectively.
To combat fraud, InComm has partnered with Tender Armor, a fraud prevention technology provider, on a pilot program to begin next year involving the Atlanta-based prepaid product and technology company’s GPR prepaid card portfolio and Tender Armor’s CVV+ fraud prevention solution.
CVV+ is designed to protect consumers from unauthorized use of their payment cards by providing a new, daily CVV code that replaces the one printed on the back of their cards. CVV+ works for purchases online, over the phone or at the point of sale where retailers request to see the code.
If an issuer offers CVV+ to cardholders, they enroll through the institution’s Website, and select how they want to get the code: by text, daily email, text on demand or through Tender Armor’s mobile app. Cardholders also can obtain the code from the card provider’s mobile app, if integrated, and CVV+ can be configured to change the CVV code more frequently than once a day, working like a one-time password. CVV+ can work on any payment card.
“We’re brand agnostic, form factor agnostic and card type agnostic,” says Madeline Aufseeser, Tender Armor CEO and co-founder. In addition to providing dynamic, dual-factor authentication, CVV+ provides out-of-band authentication, meaning the CVV+ number isn’t connected to a cardholder’s account number in any way, she notes.
“We believe it’s the simplest and best fraud prevention tool and part of what it does is puts the power and control in the hands of the cardholder,” Aufseeser tells Paybefore. “When cardholders shop today, whether it’s online or in person, they have no idea what a merchant is doing to protect their payments data.”
Meanwhile, Intellicheck Mobilisa, Inc., an ID authentication and fraud prevention company, wants to help online retailers ensure consumers are legitimate with its Retail ID Online. The service integrates with retailers’ Website and checks purchasers’ driver’s licenses for authenticity. When consumers visit a retailer’s Website, they’re prompted to take a picture of the back side of their driver’s licenses, using a smartphone or computer camera. Intellicheck encrypts the driver’s license image and matches it against authentic driver’s license formats from Intellicheck’s proprietary ID Check database, which the company has developed over the past 20 years in conjunction with state departments of motor vehicles and other jurisdictional authorities, according to the company.
The purchase is processed when the ID is authenticated, and Intellicheck deletes the driver’s license image and data. If the license is flagged as counterfeit, the purchase process ends and Intellicheck keeps the counterfeit image for law enforcement and product enhancement purposes.
Retail pilots of the technology will begin in November, the company said.
- As Fraud Moves to CNP, New Company Aims to ‘Armor’ Transactions
- EBay and IDology Boost Authentication Efforts
- EMV: The Ripple Effects of Fraud