Online fraud and how to fight it

Trust is the foundation of any relationship – and the one between business and customer is no different. The customer must trust that the business is selling what it says it is – and the business must trust that the customer is who they say they are.

Online, however, this can be tricky.

Types of online fraud

There are two main types of fraud that organisations need to contend with online. The first type – and the major one – is identity theft fraud. That is, criminals stealing people’s legitimate credentials and then using them to make purchases.

The second type is Distributed Denial of Service (DDoS) attacks, whereby cyber fraudsters hit websites with multiple pieces of spam data in a very short space of time in order to seize up the system. From there, they hope to demand a ransom payment.

Both types can be hugely damaging for businesses, leading to substantial financial and reputational damage. According to the Experian 2018 Global Fraud and Identity Report, 63% of businesses experienced the same or greater fraud losses in the past 12 months compared to the previous 12. And, with the perpetrators being anyone from amateurs up to organised criminals, there is a broad battle to fight.

We can help.

How Duologi can help you fight online fraud

As a provider of online finance solutions, detecting online fraud is hugely important to our team. We need to have robust and careful protections in place – both from a technical perspective and an expertise perspective.

As such, by incorporating Duologi’s point of sale (POS) finance tool on your website, you are essentially adding an extra layer of anti-fraud filtration.

But how exactly does this filtration work?

It incorporates a series of specific, highly sophisticated digital techniques which check the risk relating to the digital profile of the end user (the applicant for POS finance).

Credit engine: multiple layers of checking

First up – when a shopper completes our (short and simple!) application form, we first need to check whether that individual has a strong digital profile or whether they are potentially a bot or spam. This includes checking their email address, which we ask for as a matter of course.

Next, we check the hardware being used by the applicant, and the IP address they are using. This generates a risk score which helps us make a final decision.

From there, having established that the applicant is digitally sound and not an automated bot, we can focus on triangulating key data such as their date of birth and proof of address to decipher whether they actually exist and are a real, living person.

They are alive! From there, we need to establish whether we trust this real, living person – primarily from a credit risk perspective – but there are certain patterns of behaviour within the credit bureau reports we receive which can indicate whether fraud is taking place too.

We can also, should we need to, check the applicant’s bank account to affirm whether the credit card matches the individual, and we can choose to check their affordability. This can help detect fraud through ‘validated evidence of income’.

Automated connections to the CIFAS – the UK’s national fraud database, can indicate whether an individual is a fraudster, suspected fraudster or has been a victim of fraud. If there’s a match, then we can undertake a further manual check.

Finally, we have developed highly sophisticated in-house time-series checks and event data checks which are totally unique to Duologi. These are highly predictive and are there to protect us and the merchant.

The human element: additional links to expertise

But technology is just one part of the anti-fraud story. Beyond these multiple layers of automated checking, we also have additional links we can draw on. We have direct relationships with people who have been involved at a senior level with the National Crime Squad, the Bank of England and other relevant bodies.

We like to test and learn – to try out different rules and constantly search for new ‘data bullets’ to prevent fraud. There is no single silver bullet. Rather, there are lots of smaller indicators which, when you connect them, give a powerful profile of each applicant.

The bottom line? Introduce Duologi’s POS finance at your online checkout and you are also introducing a huge array of anti-fraud tools, from an established expert in this space.

Get in touch with us today to find out more about how we can help you fight online fraud.