As Consumer Loyalty Programs Grow, Associated Fraud Prompts Need for Greater Security
CyberSource, a Visa Inc. (NYSE:V) company, announced the launch of its Loyalty Fraud Management Solution, a new service that helps businesses guard against fraudulent account creation and protect customers from illegal use of their loyalty accounts, including theft of points, miles and misuse of payment credentials.
According to RFi Group, an estimated $238 billion in loyalty program rewards earned by consumers through airlines, hotels and other programs, have never been redeemed. This proliferation of loyalty currency comes as companies place increasing emphasis on rewarding their best customers and driving customer engagement. As loyalty accounts increase in value, a growing number of cyber criminals are attempting to transfer points into fake accounts, and purchase loyalty points or miles with fraudulent credit cards.
“This type of fraudulent activity not only impacts the profitability of businesses, but also hurts customer trust and loyalty — the very things these programs were designed to build,” said Andre Machicao, senior vice president, CyberSource. “To protect themselves and their customers, businesses are seeking ways to monitor fraud throughout the entire loyalty program lifecycle. This is exactly what our new Loyalty Fraud Management Solution is designed to do.”
The CyberSource Loyalty Fraud Management Solution helps program owners protect against account takeover and all other activity, including fraud that may occur with incremental points purchases, points transfers and points redemption. The solution combines advanced analytical algorithms, customizable rules and insights from the more than 68 billion transactions Visa and CyberSource process annually to monitor for suspicious activity. With the new CyberSource Loyalty Fraud Management Solution, businesses can reduce fraud as their loyalty programs grow and protect their relationships with their most valuable customers.
Available immediately, the CyberSource Loyalty Fraud Management Solution is a new capability of CyberSource’s flagship Decision Manager fraud management platform. Decision Manager features the world’s largest fraud detection radar and real-time fusion modeling technology, which blends sophisticated machine learning algorithms, along with a flexible rules engine to help businesses swiftly and accurately respond to emerging fraud trends.
CyberSource, a wholly-owned subsidiary of Visa Inc., is a payment management company. Over 475,000 businesses worldwide use CyberSource and Authorize.Net brand solutions to process online payments, streamline fraud management, and simplify payment security. The company is headquartered inFoster City, California and maintains offices throughout the world, with regional headquarters in Singapore, Tokyo, Miami/Sao Paulo and Reading, U.K. For more information, please visit www.cybersource.com.