Fraud Management - Overview

Selling online enables merchants to grow and scale their business substantially. However, it can result in goods being shipped that you might not get paid for. In addition to using 3D Secure for all online transactions, you can also mitigate this risk by using our Fraud Management solutions:

• Fraud Filter — Automatically pass, hold, or block transactions based on the result of one or more rule results screened during a transaction.
• Address Verification Service — Verify the customer’s address provided at the time of sale against the issuer’s records.
• Decision Manager — Perform standalone or automatic risk assessment for transactions.

Fraud Management offers:

• Over 30 fraud rules, including powerful pattern and velocity rules with 12 data lists
• A fraud filter Passive mode to hold risky transactions for manual review, preventing false positives
• A simple user interface to set up and manage filter rules
• The ability to easily incorporate fraud rules for every transaction you process

In this section, we present some “real world” examples that can be enabled through Fraud Management. Keep in mind that this section doesn’t cover all of the use cases.

Use case #1: Limit the number of cards for top-up services

A mobile operator discovers that fraudsters are using multiple stolen credit card numbers to top up “pay as you go” mobile accounts. However, by the time the mobile operator receives chargebacks from the cardholders, the credit has already been used. Using fraud filters, the mobile operator can now limit the number of different cards that can be used to top up any “pay as you go” mobile. After the limit is reached, any new cards that are attempted are blocked or held for further review by the merchant. Likewise, the mobile operator can limit the number of top-ups allowed per day, per week, and so on.

Use case #2: Monitor high transaction amounts

An online merchant observes an increased occurrence in chargebacks due to alleged fraud claimed by cardholders. The amounts for these transactions were substantially higher than what the merchant typically processes for their business. The merchant has since implemented 3D Secure to help protect against fraudulent online transactions. However, the merchant has opted to also implement two fraud filters as an additional layer of security:

• Fraud rule #1: Hold a transaction (for further review) if the amount is higher than a predefined amount set by the merchant. This allows the merchant to review the transaction and validate with the cardholder before releasing it to be processed.
• Fraud rule #2: Block a transaction if 3D Secure authentication was not successfully performed on the cardholder.

Use case #3: Screen without losing sales to false positives

A large multinational merchant wants to implement a set of various fraud rules but needs to ensure that the rules are properly configured and will not result in a substantial number of false positives leading to lost sales. In this scenario, the merchant can activate the rules and turn on Passive mode. When in Passive mode, all live transactions are screened by the established fraud rules. Fraud results will be generated but will not block or hold any of the transactions. This allows the merchant to first monitor the behavior and effectiveness of their fraud rules and to subsequently make any necessary adjustments before enabling them in Active mode to put them into action.

The Fraud Management Fraud Filter enables merchants to automatically hold, block, or pass transactions based on the result of one or more rule results screened during a transaction. You can configure and enable fraud rules on the Ecommerce Portal (RealControl) in the Fraud Management section. Fraud Filter must be set up first before being used via our REST API. For steps and code samples for how to use Fraud Filter, see our Fraud Filter guide.

Create rules

You can create new Fraud Filter rules from the Rules tab as shown below. From the Data Lists tab, you can manage your data lists, which are used by certain rules (for example, a high-risk card number list or medium-risk IP address list).

Fraud Filter - Rules Tab

To make it easier to organize your rules, we provide preset categories, as described in the table below.

Set mode

You can set the Fraud Filter mode for individual fraud rules for a given transaction. There is also an option to turn off one or more rules while maintaining the other rules as Active, which can be done using the Passive or Off setting.

• Active means that the fraud rule will run, and the resulting action (for example, Hold or Block) will execute. This is recommended if you are sure of the behavior of the rule and the action you want to take.
• Passive means that although the fraud rules will run and will get the appropriate response values, the resulting action (for example, Hold or Block) will not execute. This is a good way to test new rules and see what their outcome will be before setting them live (Active).
• Off means that the fraud rule will not run at all. Setting an individual fraud rule to Off disables the rule for a particular transaction, while still running all other rules.

Review held transactions

Transactions that were held, blocked, or failed by Fraud Filter can be viewed on the Transactions screen in Ecommerce Portal (RealControl). If you want to review a certain held transaction, just search for transactions with a “Held” status. After finding the one you want, you can then view the details on the Fraud tab for the transaction.

Check out the following guides to learn how to integrate Fraud Management into your application or website.