There’s an old adage that the best place to hide is in plain sight. And for criminals looking to hide high-volume spending, there’s no better day than today – Black Friday, the unofficial opening of the Christmas shopping period. Criminals eager to hide their own nefarious intentions believe that their behavior will be classed as less unusual or suspicious when everybody is busy buying.
Many rule-based fraud prevention and detection activities can struggle to distinguish between values, volumes, velocities and profiles of spend for genuine customers and criminals at times of higher purchase concentration. But this is where a system like FICO Falcon Fraud Manager really comes into its own.
Not only does Falcon calculate a risk score for every card authorization or transaction, between 1 and 999 in increments of one. Using supervised models created using patented neural network technology, and trained on massive volumes of fraudulent and genuine transactions from the Falcon Fraud Consortium, the system can distinguish risky purchases with unrivalled accuracy.
Falcon’s analytic prowess extends into other areas such as profiling of a card or a customer – assessing whether a transaction, whether risky or not in the context of past consortium data, is actually typical or not for the card or customer concerned. This helps to reduce instances of a customer being inadvertently stopped when making a true purchase (or a false positive, as it is known). Falcon also has a merchant profiling capability, which is capable of determining whether a transaction sequence is unusual or not for that outlet.
These and other analytic capabilities in Falcon generated real excitement earlier this month at our FICO World conference in San Diego. I encourage you to dig into the presentations to learn about adaptive analytics, behavior sorted lists and other technologies that stop the Christmas season from being a black time for shoppers.