For years now, it’s become customary for companies to write off a certain percentage of online transactions on the P&L to account for the fraud they assume will get passed their anti-fraud defenses. But is accepting a certain amount of fraud loss any way to combat a problem that’s increasingly impacting sales revenues and taking a bite out of your bottom line?

To reduce fraud rates, social networking sites are using their own social verification systems to determine whether the person at the other end of a Web transaction is actually who they say they are. According to the article, “How your social network can protect your credit card,” social networking sites like Facebook collect various pieces of information about a user’s personal network to identify a person and reduce fraudulent activities such as credit card fraud, account takeover and account hijacking within their network. (more…)

The Internet Crime Complaint Center fielded 303,809 reports of cybercrime in 2010. Of those cybercrime reports, auction fraud was the third most common complaint.

Auction fraud refers to fraudulent transactions on online auctions. Either a product advertised for sale is misrepresented, or purchases are never delivered at all.

The IC3’s annual report explains, “Historically, auction fraud has been the leading complaint reported by victims, with a high of 71.2 percent of all referrals in 2004. However, in 2010, auction fraud represents slightly more than 10 percent of referrals. This demonstrates the growing diversification of crimes related to the Internet.” (more…)

FedEx isn’t responsible for this scam, but their brand unintentionally lends credibility to the scammers, who reference FedEx in their scammy emails, knowing that aligning with FedEx helps their scam proliferate. It’s an insidious ruse that hurts all involved.

FedEx can and should deny suspicious online transactions. Moneygram and Western Union could also make some effort to deter scammers. It’s hard to weed out the bad guys, but there are technologies that help.

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Match.com has begun screening for users whose names appear on public sex offender registries. As I told the E-Commerce Times, “Doing nothing is a poor option. Also, consider that not every sex offender is tech-savvy, and some will get banned.”

My first passion has always been personal security as it relates to violence prevention. I got into this business 20 years ago as a result of violence in my own life, and began to write, speak and train in self-defense. Things are no different today, except that there are now many more ways for bad guys to ensnare their victims. (more…)

This is just weird, but what about social media isn’t weird? We “friend” people we’ve never met. We share our plans, location, and mother’s maiden name with the world.

In New Zealand, weird can be defined as a 28-year-old Auckland woman who created and used several fake online profiles depicting young, pretty women to befriend unsuspecting high school boys. (more…)

Dating website Match.com is being sued by a woman who was abused after meeting with a man through Match.com. In response, the website has initiated a system to vet out sex offenders by checking registered users against sex offender registries.

Will this prevent sex offenders creating Match.com profiles? No. Will this prevent sex offenders from abusing women they meet on the site? Of course not. (more…)

I’m very proud to announce that iovation was recently positioned in the Visionary Quadrant of Gartner’s 2011 Magic Quadrant for the Web Fraud Detection. For a security provider who’s been helping customers across many industries prevent online fraud since 2004, we are pleased to receive this position in the analyst firm’s annual report.

The Visionary section of the Magic Quadrant recognizes security vendors whose products are easy to implement and have successfully reduced online fraud for their customers.   (more…)

Reed College’s entire website was recently copied and replicated, but with the fictitious name “University of Redwood.” The Wall Street Journal reports, “Officials at Reed suspect the site is part of a scheme to collect application fees from prospective students in Hong Kong and Asia.” Presumably, scammers could simply collect a fee and then issue a rejection letter several weeks later.

Spoofed websites are generally created in order to phish for consumers’ personal information, or to accept credit card payments for products or services that will never be delivered. (more…)

They say there’s a sucker born every minute. Not everyone can be sophisticated and worldly. Unfortunately, naiveté invites predators and victimization.

Social engineering is the act of manipulating people into performing certain actions or divulging confidential information. Essentially it’s a fancier, more technical form of lying.

Combine naiveté with predators who use social engineering to manipulate their victims, and you get stories like this one, about an Illinois man who sent more than $200,000 to an “online girlfriend,” who didn’t actually exist. The man believed he had been in a relationship with the fictional woman for more than two years when he called police to report that she had been kidnapped in London. He then explained that over the course of the relationship, he had wired money to bank accounts In Nigeria, Malaysia, England, and the United States at his supposed girlfriend’s request. (more…)

Despite the recession, online dating and matchmaking services are becoming increasingly popular. More than ever before, people are looking for love online.

Like a roller coaster, online dating can be fun and exciting, or it can be nauseating. Most dating veterans have been there, done that, with a few regrets and lots of lessons learned. While you may have already experienced a lot, you have yet to see it all.

It’s essential to be able to distinguish a conscious, healthy search for a mate from one that is potentially destructive. (more…)

Every day iovation assesses risk on more than 7.5 million transactions for the online customers that we protect around the globe. France ranks third by country, just behind the United States and United Kingdom, in the total volume of Internet traffic from any country that we protect. As you would imagine, France is a very important market for us. It is growing and as we continue to expand our international footprint, France will play a vital and strategic part in our growth.

As part of our effort to expand our device identification, device reputation and real-time risk mitigation services for online businesses in France, I am pleased to announce that Philippe Mazurier has joined iovation as Country Manager, heading up sales and business development and is based in Montpellier.

Philippe brings strong business relationships and deep, in-market experience that will be instrumental in helping us meet online fraud protection demands in this market. He understands the serious and damaging impacts that cybercrime has on online businesses.

As we continue to serve the French market, protecting e-commerce, financial services, gaming and online communities from fraud and abuse, having a seasoned veteran in authentication and fraud prevention services representing iovation will help us serve this market even better.

To arrange meetings with Philippe to talk about any fraud or abuse issues your company is experiencing, please email france@iovation.com or call +33 (0)6 69 79 12 33.

Remember the days when being a cyber crook required specific computer programming skills that allowed hackers to crack codes and exploit vulnerabilities on a system? It was a job only for those who possessed rare talents and had loads of time on their hands. Not anymore. Today’s cyber criminals are a far cry — and are much less specialized — from the cyber crooks of yesterday.

According to the Wall Street Journal article, “Cyber crime now an industry,” the average cyber criminal is not at all who we think he is. He’s not some socially awkward kid cooped up in a poorly lit basement causing havoc across the globe. That’s not to say there aren’t organized gangs causing worldwide headaches. There are. But, from a technical standpoint, the majority of those perpetrating online fraud and abuse are more like you and me. (more…)

It’s a trend that has stood the test of time. Whenever something is a hit with consumers, everybody wants a piece of it. The same is true for cyber criminals, who are basically opportunists that operate on the wrong side of the law. Every time a new technology or social networking service hits a cord with the mainstream, hackers aren’t far behind.

While we know fraudsters can’t resist a sure thing, Craig Scroggie, vice president and managing director of Symantec in the Pacific region, said most of the time consumers turn a deaf ear to such warnings until it is too late. In the article, “Cybercrime to hit tablets,” Scroggie, who has warned consumers about potential threats to email, fake websites and computers in the past, is at it again. This time he says the proliferation of smartphones and tablet devices will soon face the same type of attacks PC owners have long suffered. (more…)

Twitter’s numbers are astounding. In the physical world, when communities become larger and more densely populated, crime rises. The same applies to online communities.

CNET broke down Twitter’s recent blog post, which celebrates their significant numbers: “It took three years, two months, and one day for Twitter to hit 1 billion tweets; now, a billion tweets are posted in the course of a week. An average of 460,000 new accounts were created per day over the past month, and an average of 140 million tweets were posted per day. Twitter now has 400 employees, 50 of whom have been hired since January.”

Spammers, scammers, and thieves are paying attention.
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The recession may have waned, but we aren’t out of the woods yet. The unemployment rate is still a staggering 9.5%. That’s millions of people without a job. Many who were displaced eventually got lower paying jobs, and are barely able to get by.

Jobseekers’ desperation for employment makes them vulnerable to work-from-home scams and fake job listings.

The Federal Trade Commission recently announced that it has ”stepped up its ongoing campaign against scammers who falsely promise guaranteed jobs and opportunities to ‘be your own boss’ to consumers who are struggling with unemployment and diminished incomes as a consequence of the economic downturn.” (more…)