Community Research and Development Information Service - CORDIS

Technological solutions for credit card fraud

A new credit card fraud detection/prevention solution using a novel approach consisting of spatial analysis methodologies and cellular Location Based Services identity authentication has been developed. This technology will be of specific use for POS (Point of Sale) and ATMs (Automatic Teller Machines) transactions.
Technological solutions for credit card fraud
The losses resulting from payment card fraud cost billions each year. Thus, new detection and prevention systems are continuously sought by credit card issuers. This new technology will help credit card establishments resolve risk management issues by significantly cutting down the rate of their occurrence as well as the rate of false alert responses.

What makes this solution possible is the merging of advanced pattern analysis algorithms and state of the art cellular positioning technologies. The transaction analysis consists of the authentication process as well as various self-learning and self-analysis algorithms, making this technology one of the most reliable and foolproof solutions possible. Some of these include mathematic, geometric, data mining and artificial intelligence algorithms.

The Location Analysis (LA) processes set up spatial behaviour patterns for cardholders and merchants that can be used to evaluate transactions in real time. A standard of deviation from the learned pattern is generated for each transaction and alerts are raised as necessary fitting the score-based criteria, which the customer sets.

The system contains a standard interface with the cellular carriers for receiving basic location information and for sending SMS messages. Additionally it has a low cost of deployment and operation, a short deployment process and simple system operation. System integrators are sought for technical cooperation.
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