Payments and Fraud Glossary

F

Face recognition

Biometric modality that uses an image of the visible physical structure of an individual face for recognition purposes.

False front merchants

Entities who hide the true nature of their businesses and sales of card-brand prohibited goods and services. These companies do not actually engage in selling what they claim during the merchant underwriting process, and usually are involved in illicit, illegal endeavors

False positive

It occurs when a good transaction or order is rejected by either the issuer or the merchant, due to suspected fraud.

FIDO (Fast ID Online)

A set of technology agnostic security specifications for strong authentication. FIDO is developed by the FIDO Alliance, a non-profit organization formed in 2012.

Fraud apps

These are fraudulent apps that work in two ways:

  • simulated ad interactions;
  • intentionally misleading buttons or layouts.

In the simulated ad interactions, bots trigger ad activity. With the misleading buttons or layouts, developers create layouts that overlap ads with content so users will unintentionally click the ads. Users usually have no intention of clicking some of these ads but do so because the ads are so small that they tap them by mistake. Furthermore, these types of apps can contain more ads than they are usually allowed by their operating system to serve, or display ads outside of the screen view of an application.

Fraud detection

Tools and techniques used to detect ‘acts of fraud’. It includes tools and techniques for: data analysis, data mining, rule based detection systems, supervised machine learning systems, and unsupervised machine learning systems.

Fraud management

Organizational processes to prevent, detect, contain and remedy fraud.

Fraud prevention

Processes, tools, and techniques used to prevent ‘acts of fraud’. It includes communication and awareness, authentication, and other business processes controls.

Fraud screening

A checking system that identifies potentially fraudulent transactions. Fraud screening helps reduce fraudulent credit card transactions, eliminating the need for manual reviews, minimizing bad sales and improving a company’s bottom line.

Federated identity

A federated identity is the means of linking a person’s electronic identity and attributes stored across multiple distinct identity management systems. Without federated identity, users are forced to manage different credentials for every site they use.

Related to federated identity is single sign-on (SSO), in which a user’s single authentication ticket, or token, is trusted across multiple IT systems or even organizations SSO is a subset of federated identity management, as it relates only to authentication and is understood on the level of technical interoperability which would not be possible without some sort of federation.

Fingerprint recognition

Biometric modality that uses the physical structure of the user’s fingerprint for recognition. In most fingerprint recognition processes, the biometric samples are compressed in minutiae points that reduce the size of data and accelerate the process.

First-party fraud

Fraud committed against a financial institution by one of its own customers.

Forgery

The process of making or adapting documents, such as checks, with the intent to deceive.

Fraud ring

A group of people who commit fraud together.

Fraud score

A fraud score may be available during transaction authorization This is a number, usually between 0 and 1,000 that represents the overall fraud risk of a particular transaction. The higher the number, the riskier the transaction.

Friendly fraud

When a consumer (or someone with access to a credit card) makes a purchase and then initiates a chargeback, saying they did not make the purchase and/or did not receive the goods or services.