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IDG Contributor Network: Holiday shopping season and fraud: Not one without...

Consumers are shopping online more than ever before. Holiday season has e-commerce marketing and sales teams working overtime to churn out attractive holiday campaigns. With holiday come a flurry of fraudulent transaction with fraudster lurking in the dark ready to spoil the spirit of the season.

As sales increase, so will the total dollar amount of fraud transactions. "Retailers need to constantly improve their level of fraud prevention by incorporating consumer purchasing behavior analytics and originating IP addresses for online orders.

This should help minimize a spike in online orders," said Max Silber, Director of Mobility at MetTel, a B2B communications and IT firm in New York. Know thy past According to enterprise e-commerce fraud prevention solution Riskified, retailers see a 100% rise in the number of purchases made using international credit cards and therefore advise merchants to scour past data to understand and dissect successful orders and transactions from fraudulent ones. "Most merchants are likely to discover that they've been overly risk averse during the holidays. Our analysts have determined that top holiday sales days are actually far safer than average shopping days, and that any given order placed during the holidays is 55% less likely to be fraudulent. Partially because merchants were unaware of this, 4 out of 5 orders rejected during last year's holidays were, in fact, legitimate," wrote Riskified's Ephraim Rinsky in a blog post. Rinsky writes that it's crucial for e-commerce merchants to understand the difference between customer profiles to understand future behavior. "The fraud rate among returning customers is about half that of new customers: 1.4% compared to 2.6%.

This means that returning customers should be treated very differently than new ones.

This distinction is especially critical during the holidays, when order volume is so much greater." As e-commerce platforms keep accumulating consumer data, these businesses become even more valuable targets to cyber-criminals looking for economic gains. "In addition to hacking into companies' customer databases, cyber-criminals can also spoof companies' identities to trick customers into divulging their personal information by sending emails with misleading subject lines such as "Click to track your transaction," said Gus Anagnos, VP, Global Alliances of crowdsourced cybersecurity firm Synack. The problem with same-day delivery The interesting question fraud isn't only about the increase in the sheer volume of transactions, but also about the improvement in logistics. Many retailers, namely Amazon, are offering same day delivery services, which opens up another front in the fight against cyber hacks. "The increasing demand for same-day delivery will raise the bar for fraud detection service providers.

The faster the turnaround from order to shipment, the more sophisticated the tool to give a go/no-go assessment for each transaction.
It will be increasingly difficult for brands of any size to manually handle fraud detection on their own," said Thom O'Leary from Fixergroup. Same-day delivery decreases the amount of time between the transaction and the time your purchase takes to show up at your door.

This means consumers have less time to take notice of the problem and then contact the merchant or their bank regarding the fraudulent transaction.

This is important because after the item ships, there is little to be done to recover it.

To complicate matters, most consumers contact their bank first which adds lead time to how long it takes the merchant to be notified of the issue, which can take weeks on occasion. "There are solutions that can help mitigate this by analyzing the order information, such as the billing address, shipping address, and IP address of the purchaser to determine if there is a higher risk for fraud.
In which case you can choose to hold the shipment until the transaction can be verified," said ExpandLab's Eddie Spradley. As the holiday season shopping is in full swing, it's clear that e-commerce merchants need to do a better job tracking past data to understand future customer behavior and the consequent threats.

This understanding becomes even more important with new and improved methods of delivery, such as same-day delivery, which poses a whole new dilemma for merchants. This article is published as part of the IDG Contributor Network. Want to Join?

IP EXPO Europe 2016 Kicks Off With Insights to AI and...

IP EXPO EUROPE 2016 opened yesterday with a fascinating glimpse of the future, into a world enabled with Artificial Intelligence (AI), from Nick Bostrom, Founding Director of Oxford University’s Future of Humanity Institute. One of the world’s leading thinkers on the implications and potential effects of artificial intelligence, Bostrom discussed how the rise of AI, enabled by the convergence of cloud computing, connectivity and the internet of things (IoT), could shape the future of human kind.Bostrom claimed that we are on the cusp of a third technological revolution and argued that now is the time to evaluate how we want our world to be shaped by AI. He called for society and especially technologists, to start defining ground rules for the safe application of these tools. IP EXPO Europe logo This theme of requiring intelligent approaches to deploying technology, was reflected in many of the hundred plus presentations yesterday, which spanned the key themes of cloud, cyber security, networks, analytics, DevOps and open source software. The cyber security panel, chaired by Technology Correspondent, Rory Cellan-Jones, and featuring leading security experts Eugene Kaspersky (Kaspersky Labs), James Lyne (Sophos), Joshua Corman (Sonatype) and Rik Ferguson (Trend Micro) - explored the reality of IT security yesterday.

The panel considered whether it is possible to ever be fully secure, and the resulting implications for organisations. In his presentation, Mark Russinovich Chief Technology Officer for Microsoft Azure took a similarly pragmatic approach, looking at the common barriers that prevent organisations from seizing the benefits of cloud computing, then demonstrating how approaches such as hybrid cloud and other emerging cloud capabilities can overcome them. Russinovich then shared examples of how, with these approaches, some of the world’s largest and most risk averse companies had moved from a position of cautious evaluation, to adopting public cloud infrastructure on aggressive timelines. HPE used day one to host a series of events focused on how businesses and Government can support the flow of technology savvy talent in the future.

A lively discussion at the HPE STEM panel, chaired by Dr.
Sue Black, MBE, concluded with a united view that the school curriculum needs urgent revision to ensure adequate STEM skills and talent in the future. IP EXPO Europe’s second day is opening with a key note from James Gosling, legendary computer programmer, and the Father of the Java programming language now used in billions of devices and applications.

Gosling will give the real story behind the creation and success of Java and insight into his current projects at the intersection of IoT/robotics, cloud computing, and the mysterious world of remote digital communications.