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Why behavioral biometrics will transform fraud

27-Nov-2017

Bradley Wiskirchen is the founder and CEO at Kount, a fraud protection software business for card-not-present transactions. The fintech is currently working in partnership with some of the largest merchants and acquiring banks across the payments ecosystem.

PaymentEye sat down with Bradley at Money20/20 Las Vegas to discuss the best way to battle fraud and how behavioural biometrics will become a trending topic.

Can you give me an overview of Kount?

Kount is an enterprise of fraud control solutions. We represent some of the largest merchant aggregation points, such as payment gateways, and we also directly represent some of the largest online retailers and merchants in world, such as Dunkin’ Donuts.

A lot of what we’re seeing is traction amongst the more traditional retail stores who are digitizing the customer experience. For example, Domino’s is moving their business online or on an app. To securely do this, these companies have to deal with new types of fraud that they’re not usually used to dealing with.

How does Kount integrate with these merchants?

There are several ways to integrate with our business – they can either integrate with us or they can integrate with our partners such as BlueSnap or Braintree and get automatically get integrated with Kount.

Fraud is one of the key topics from Money20/20. In an industry filled with innovation, why is fraud increasing?

When the EMV was launched in October 2015, it pushed a lot of the fraud that was once linked with traditional retail stores to businesses online.

As businesses are moving their presence online and digitizing their experiences, we’ve also found that the fraudsters are simultaneously moving their efforts online, which is creating a lot more opportunity for fraud.

Merchants and their payments processors are also prioritizing fraud and fraud control.

What advice would you give for successfully combatting fraud?

You have to be cautious from several angles. There’s a lot of players out there that say, “use our AI, set it and forget it.”

While that may be effective, essentially, it’s plugging a bunch of square pegs in a round hole. What you need is real intelligence in order to fight fraud; artificial intelligence combined with human intelligence.

We’ve been implementing AI for years before it was even cool to talk about it – and we’ve found it most effective when you combine it with human intelligence and real expertise in combatting fraud.

You need to be able to adjust your fraud control solution and your formula based on your company’s own needs for fraud, as it differs for every industry. For the restaurant industry, the appetite for fraud may be different to someone in the digital space.

What trends will we be talking about this time next year?

For fraud, I think we’ll hear more about behavioural biometrics. We announced a partnership earlier this year, and we will be integrating behavioural biometrics in Q4 into our solutions.

It’s an incredibly important tool that gives businesses insights about transactions that are real and enables them to holistically debate and buy products.

Behavioural biometrics can examine how a consumer moves their mouse, how they navigate when using their phone, and then differentiate these behaviours and data to compare with those typically seen in fraudsters.