Trends Report

Market Overview: Fraud Management Solutions

Seven Tenets Of Effectively Combating Fraud Costs

August 25th, 2010
With contributors:
Stephanie Balaouras , Lindsey Coit

Summary

Fraud causes companies to lose money in many ways: They face losses due to chargebacks, unrecoverable transfers, and unnecessary shipping costs; and spend extensive time and resources investigating many transactions. Fraud can impact a company's goodwill. With fraud rings expanding operations beyond the online channel to ATM, POS, branch, and call center, financial services and other organizations need effective ways to protect against cross-channel fraud. Forrester's interviews with IT end users highlighted the following tenets as being important in fraud management products: 1) Use a statistical, vertical model to assess risk scores; 2) use rules to respond to emerging threats; 3) monitor transactions and entities across channels; 4) interdict near real time; 5) use entity and link analytics to see how fraud rings operate; 6) integrate disparate fraud management systems' case-management interfaces in order to navigate between fraud cases and cross line of business boundaries; and 7) integrate with adaptive authentication's monitoring of the login context. We looked at how vendors satisfy these tenets and also provide detailed information on vendors' market presence.

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