Chargebacks911® COO’s Latest Column for PaymentsSource
PaymentsSource offers independent and authoritative analysis for every segment of the payments industry. As such, they’re one of the most trusted perspectives for news and information about new developments in the space. Chargebacks911 COO Monica Eaton-Cardone is a regular contributor to their PayThink section, which invites payments professionals and thought leaders to share their insight.
A common fraud tactic known as “synthetic fraud” is one of the most insidious tactics out there designed to separate merchants from their hard-earned revenue. Monica addresses synthetic fraud in her latest feature for PaymentsSource.
“According to the State of Card Fraud 2018 report, synthetic fraud is estimated to account for 85% of all identity fraud in the US,” Monica says. “We can trace a shocking 80% of total criminal fraud losses on credit cards to synthetic attacks. While merchants pay a heavy price for all these fraud attacks, they’re not the only party feeling the impact. For financial institutions, synthetic fraud causes nearly 20% of total credit card charge-offs or bad debts that are unlikely to be collected.”
There are ways to fight back synthetic fraud. For instance, there’s in-depth data analysis; of course, this requires access to substantial amounts of customer data. Ultimately, Monica suggests redundancy may be the best approach.
“Using multiple layers of authentication to validate consumers’ identities provides a more detailed profile with greater insight. Online retailers can utilize a variety of anti-fraud tools to detect synthetic actors like geolocation and address verification.”