Why Merchants Are Focusing on Big Data as They Look to Detect Fraudsters
Big data holds important clues for merchants looking to track down fraudsters who are hitting their business. Retailers including Kount client Micro Center, which sells computers and electronics both through brick and mortar locations and online, are now analyzing their data, hunting for evidence of fraudulent transactions.
“Today,” says Skip Myers, director of loss prevention at Micro Center, “If you want to get ahead of the bad guys, you got to spend time in the lab.” If this seems like a job for a detective, you’d be right. Myers worked in law enforcement in Atlanta for more than 10 years before he joined Micro Center.
“All it takes,” Myers told PaymentsSource.com “is a basic understanding of the things the justice system requires to build a case.” That includes data, which merchants can pool by working together. Kount technology underpins his approach: merchants share their customer data anonymously, feeding into the platform’s fraud scoring for each transaction, and enabling each to decide whether to accept or reject individual payments.
The number of non-merchant payment and fraud providers offering data sharing fell to 17.3% in 2014, from 24.4% in 2013, according to the Mobile Payments and Fraud Report commissioned by Kount, The Fraud Practice and CardNotPresent.com. Don Bush, Vice President of Marketing at Kount, says merchants can be shy of sharing their data with competitors. But those who do and opt for strong fraud prevention can outcompete their shyer rivals.
Big data has many uses for those who can harness its powers, and at Kount we’re putting it to use in the fight against fraud. Key to its success is the scale at which it’s used. As more companies add their data to the figures, this will become an ever more powerful defense in the fight against fraud. That’s important when fraudsters are themselves using more sophisticated tools in their efforts, including good data, from identification details to financial records, that’s been compromised. When we work together, big data can reap rewards, but for those working alone, detecting and preventing fraud is getting more difficult.