Retail fraud occurs in multiple ways depending on the type of goods, services, sales channel, and payment methods you accept. Therefore, fraudsters have many attack points. As a result fraud has increased significantly over 2018 based on a spike in remote and anonymous online shopping volume where fraudsters focus on your digital goods. The cost and volume of fraud is higher for those of you who sell digitally focused goods and services than inside physical stores; and the larger the merchant, the higher the costs. This is frustrating for merchants.
Ginicoe tracks and monitors both successful fraud attempts and prevented fraud by product type, payment method, and sales channel.
THE COSTS OF FRAUD
PRODUCT TYPE: DIGITAL GOODS
For every $1 of fraud it costs digital merchants between $3.04 and $3.56 with the higher figure representing retailers that sell digital goods such as e-Gift cards. Digital goods sellers incur the majority of costs which are related to fees charged by 3rd party distribution vendors and credit card companies, including fines if chargebacks reach a certain threshold, merchant category, the time between authorization and clearing, the presence or absence of identity verification, the submission of enhanced transaction data, and a merchant’s sales and transaction volume.
Digital Goods also involve really quick transactions such as e-Gift cards by email. This enables “fast fraud”. Thus, online merchants have more difficulty distinguishing between legitimate versus fraudulent customers within the short window required to make the sale. That means that digital goods sellers have a higher proportion of indirect losses. This has a multiplier effect on your costs.
PRODUCT TYPE: NON-DIGITAL GOODS
For every $1 of fraud it costs physical merchants between $2.48 and $2.82 – that means that fraud costs physical goods and services merchants more than roughly 2 ½ times the actual loss itself. Fraud cost as a percent of revenues ranges between 1.58% and 2.39%. Physical goods, merchants need to purchase and replace lost merchandise.
DIGITAL vs. NON-DIGITAL FRAUD COSTS
The nature of fraud costs and chargebacks differ between physical and digital goods. Aside from the direct cost of fraud losses, there’s also indirect and opportunity costs stemming from challenges with identity verification. Delayed transaction confirmation can increase customer friction; for the online channel, in which consumers increasingly expect faster results, this heightens the risk that they will leave before finalizing a transaction.
Additionally, the lack of identifying legitimate from fraudulent customers can result in higher costs associated with manual reviews.
Finally and most importantly, declining a legitimate transaction based on incorrect or absent identity verification can result in not just lost revenues, but the loss of potentially positive lifetime value when alienating a prospective customer.
We cover payment methods for all credit cards, debit cards, department store cards, oil and gas cards, travel and entertainment cards, bill payments to mobile carriers, and mobile wallets.
Your customers will be required to enroll and register for FREE the account numbers of your accepted payment method. All personally identifiable information and account numbers are encrypted in storage, in transit, and in processing. Ginicoe does not track checks, cheques, refunds, bounced checks, or cash for merchants.
BIOMETRIC FACIAL RECOGNITION
PRICING BY CHANNEL
ELITE - Platinum - Digital Good Sellers –These goods are stored, delivered, and used in its electronic format. E-goods can be obtained, downloaded, and distributed quickly, leaving less time for identity verification – particularly among those conducting manual reviews.
These sellers require really really quick real time transactions. As a result, these organizations have higher fraud costs compounded because of the digital product, the digital channel, and payment method. Making matters worse, these merchants also fall victim to botnet fraud.
These merchants attempted fixes often is approached with a one-size fits all that focuses separately on the product or the channel or the payment method, but rarely all.
Merchants should purchase this Ginicoe software suite if they want real-time identity verification equally for (1) your digital goods and (2) your digital channel and (3) your accepted payment method – all at the same time in a really really quick identity verification. Common products that can benefit from our solutions are
Airbnb gift card e-Tickets Nintendo gift cards
Applebees gift card GameStop gift cards Old Navy gift cards
Barnes and Nobles GAP gift cards Online Betting
Bath & Body Works Home Depot gift card Online game
Bed Bath & Beyond Hulu gift card Overstock gift card
BestBuy e-Gift card internet radio Petco
Brinker Restaurants internet television Prepaid gift card
downloadable music JCPenny gift card Southwest gift card
downloadable software Lowe's gift card Spotify gift card
Ebay gift card MasterCard gift card Target gift card
e-books & manuals Netflix gift card TGI Friday gift card
e-Gift Cards Nike e-gift cards Uber gift card
Visa Virtual Accounts Zappo's e-Gift card ULTA
PLUS -mCommerce Sellers (mobile phones) -. These sellers require mobile browsers, tablets, iPads, mobile apps, telephone orders and sometimes augmented reality, chatbots, or messenger apps. The very nature of mobility means that mobile-based payment transactions and devices carry different levels of risk and challenges regarding identity and device verification than with eCommerce transactions. Reliance on address verification, CVV & AVV is not enough. If you are on this list, or your products are similar, you should contact us.
Amazon Mobile Coupons & Loyality Cards
Android Pay Mobile Marketing
Apple Pay Mobile money transfers
Contactless Payments and in-app pymts My Deal
Digital content purchases and delivery Nike
Electronic tickets and boarding passes Starbucks
Etsy Express Square Cash money transfer
Facebook messenger (money transfer) Taco bell
Location based services Venmo
LUSH Walmart Pay
STANDARD - eCommerce Sellers (online) –These merchants rely on online / Internet browser transactions and mail order. These merchants are declining more transactions today because they do not have identity verification. This lowers their potential revenue levels from which the impact of fraud costs are measured. And, for eCommerce merchants, this just happens to occur exactly when there is a rise in online purchasing since the past year and the trend of fraudsters is targeting this anonymous channel. In short it is a perfect storm. If you are on this list, or your products are similar, you should contact us.
Adidas Grainger Office Depot
Amazon H&M Online Lending
American Eagle Outfitters Hayneedle Overstock
Ann Taylor Home Depot Prosper Lending
Apple HP Rakuten
Argos IKEA REI
ASOS JCPenney Sears
B & H Photo John Lewis Sephora
Bass Pro Shops Kohl's Staples
Build.com L.L. Bean Target
Cabela's Lending Club Tesco
Costco Lowe's Tiger Direct
Crate & Barrel Macy's Toys'R'Us
Crutchfield Mark's & Spencer Upstart Lending
Debenhams Microsoft Urban Outfitters
Dell Musician's Friend Victoria Secret
Disney Store Neiman Marcus Walgreen
Etsy Newegg Walmart
Foot Locker Nike Wayfair
GAP Nordstrom Williams - Sonoma
Gilt Northern Tool Zalando
ESSENTIAL - POS (brick – n – mortar / physical channel) –These merchants rely on card present credit card with EMV chip layered security and card present debit card PIN layered security. As a result these merchants do not suffer from anonymity; however they do suffer from POS malware, Wanna Cry, Man-in-the-Middle (MITM) attacks, and slim sim pre-play attacks.
On the spot identity verification with facial biometrics for the merchant to protect their goods and services goes a long way in strengthening EMV & PIN existing layers of security. This holds particularly true in light of the fraud liability shift away from banks and onto merchants in the U.S. since October 2015.
International merchants are encouraged to contact one of our Specialized Industry Associates to give you guidance on the best software suite, currency conversion solution, cross-border regulations, and similarly related topics that fit your particular need so we can begin to help you to reduce your fraud costs and give you a deep dive into your fraud analytics
Merchants struggle with identity verification, which in turn can increase costs associated with excessive manual reviews and customer friction because of delayed transaction confirmation or authorized access.
Identity Verification is more challenging for larger online merchants and digital lending and financial services firms. It’s not surprising then, that the average distribution of fraud losses among larger merchants selling digital goods and larger digital financial services and lending firms involves identity fraud and unauthorized access to physical domains and software applications. For financial services and lending firms, identity fraud also enables account takeovers and internal fraud. This affects merchants and lenders alike. Below is an example of our BFR Identity Access Managment Solution:
WHY GINICOE IS BETTER
Multi-Layering with Two-Factor Authentication (2FA) is our Solution. Our research team and data scientist will create the right combination of muti-layering security solutions that will best serve your needs and your budget. Those layers may include identity verification, identity authentication, and transaction risk assessment for multi-factor authentication. By working together with your risk team, we will reduce the volume of successful fraud attempts and associated fraud costs within your enterprise.
One such solution advanced by Ginicoe is our patented Biometric Facial Recognition (BFR) Security Tool.
Online Lending; mail order
mobile browser; mobile App; tablets; telephone order; iMessaging
Checks – higher risk
Faster CVV / AVS
Cash – high risk
CVV or AVS
CVV or AVS
Credit Signature – more interchange fee
Debit PIN – less interchange fee
If you are just starting out to protect yourself from fraud or if you are researching how you can plug up the holes in your existing layers – Ginicoe can help.
Our Biometric Facial software suite works as a multi-layered gatekeeper with our patented advanced identity verification, identity authentication, and fraud transaction risk assessment. Identity verification / authentication is important for “letting your customers in” with the least amount of friction and risk. Transaction –related fraud is about keeping the “bad guys out”. Ginicoe’s patented layered approach solves this for you.
We will reduce your merchant volume of successful fraud attempts and above cited fraud costs across all or multiple or remote or omni - digital sales channels and among all payment methods. Our patented solution will increase your customer trust and loyalty plus increase your revenue plus grow your market share all while reducing your fraud costs. This is why we are distinguishable.
FLAWS OF INDIVIDUAL FRAUD SECURITY TOOLS
Without us – you are essentially working alone exposing yourself to one or more of the problems listed below:
1. Autonomous Agents - Merchant agent networks may be considered to be implementations of machine learning systems, spiders, crawlers, bots, artificial neural networks, perceptrons, or Bayesian reasoning networks. Because these agents can exhibit the functional architectures and behaviors of autonomous machine learning mechanisms they are goal based and self-contained. These agents may be backward looking as in the case of neural networks where the machine is trained on customer’s past behaviors, or they may be forward looking as in the case of branch predictions and artificial intelligence (AI). This typically occurs in a digital channel often supplemented with an external webcam, mobile phone camera, IP camera, kiosk camera, or similar image receiving mechanism. As described below, the distinction between autonomous and semi-autonomous is entirely dependent upon the merchant’s security policies.
2. Semi-Autonomous Agents – simply put this merchant agent performs with all of the attributes of an autonomous agent yet with the exception of persistent notification to a user. In other words, it is not self-contained. It may be appreciated, that a semi-autonomous agent may behave on each and every customer at one extreme or some random number of customers or other attributes, such as geographic, demographic, etc. at the other extreme. This is dependent upon the merchant’s security policies, labor intensity, peak traffic times, regulatory compliance factors, budgeting constraints, customer acceptance, and any number of countless other factors. For example, ATMs were mainstreamed in the 1980s as a replacement for tellers, yet 30 years later, tellers are still with us because customer’s still prefer some degree of human interaction. Semi-autonomous agents typically occur in a non-digital channel such as a patient walk-in, yet may perform also in a digital channel such as a patient walk-in that interacts with their remote primary physician via a webcam, iPad camera, etc. or the inverse where the physician is at work and the patient is remote and bedridden at home. In either use case, machine and humans are interacting to secure patient data to render a result.
3. EMV – EMV technology would have done little to prevent data thieves from harvesting credit and debit card data from Target's POS systems because the data was grabbed before it could be encrypted. Ginicoe can fix this flaw. EMV is only on credit cards. EMV is not on Debit Cards.
4. Debit PIN – Cheaper transactions fees for you, the merchant. PINs are embedded onto the card that can be cloned where the PIN is reset by the bad guy. Customers feel the sting of drained bank accounts quick with reduced limited liability of protection.
5. Credit Signature – Expensive transaction fees for you, the merchant. Signatures are easily duplicated. Customer’s exposure is up to $50.00 limit of liability. The balance of the fraud is passed onto you, and/or the merchant’s acquirer and may result in a higher risk score for you the merchant.
A Professional Imposter and con man had spent 25 years stealing Social Security numbers and fabricating new aliases, leaving behind a thicket of confusing and falsified records. Six weeks earlier, he had been released from a federal prison in New Hampshire, where he had served six years for identity theft as Jeremy Clark-Erskine. But he had more than 27 aliases in five states.
Andy Dufresne (aka Tim Robbins) concocts various frauds, scams and kickbacks for Warden Samuel Norton to enrich himself at taxpayers’ expense. Dufresne runs the paper trail through the nonexistent Peter Stevens. Dufresne conjures up Stevens and then creates all the legal documents necessary to run the tainted money through the nonexistent silent partner. If the IRS or others start investigating Warden Norton’s laundered money, they will chase after a person who simply doesn’t exist. “They’ll wind up chasing a figment of my imagination,” Dufresne boasts. Then Red (aka Morgan Freeman) says to Andy Dufresne, “Did I say you were good? You’re a Rembrandt!
Reproduced compliments of Stephen King’s 1994 story of the “Shawshank Redemption”
Wall Street is failing to protect our seniors from scams and identity theft. At a time when senior financial fraud is on the rise, financial regulators say those on the first line of defense—brokerages and financial advisors—aren’t doing enough to stop it. “Early detection and reporting are critical,” says NASAA’s president, Mike Rothman. Unlike younger investors, seniors do not have the luxury of time to recoup losses inflicted by financial exploitation, he says, so catching and stopping the fraud early could be the difference between having enough money to live on or not.
Reprinted courtesy of Megan Leonhardt at Money Magazine found here: http://time.com/money/4909241/wall-street-financial-firms-protect-seniors/
Roger Thornhill You're George Kaplan (aka Cary Grant – aka Archibald Leach), aren't you Kaplan? I know all about Kaplan—I’ve been in his hotel room. I’ve worn his misshapen suit. He even suffers from dandruff.
Reproduced compliments of Alfred Hitchcock’s 1959
Story of “North by Northwest”
Extra checks by the jail would not have helped 62 year old Maria Hernandez. Her arrest warrant was issued after the California Department of Insurance confused her with an insurance fraud suspect, who had used a false date of birth as well as a first and a last name that matched Hernandez's. Hernandez spent nearly two days in the county's jail in Lynwood before her family managed to bail her out. Her family now owes $2,000 to a bail bonds company. And Hernandez, who cleaned homes for years but is now retired, faces another bill of $1,470 for a medical exam conducted at the direction of jail staff.
Reprinted courtesy of Marisa Gerber of the LA Times found here: http://www.latimes.com/local/california/la-me-mistaken-identity-20160820-snap-story.html#