Commerce has gone digital and so have the fraudsters. Big data and analytics are our greatest weapon against them. We can’t eradicate fraud altogether, but there is much more we can do to fight it. The first step is to better understand and predict where fraud might occur. Data and analytics is the best — if not the only — way to do this. And your company can house the information in a cloud.

Once primarily used to run back-end infrastructures for a handful of large corporations, now any company with a digital sales platform probably has at least a part of its business in the cloud. In terms of fraud prevention, the cloud allows organizations to consolidate and analyze sales data from disparate sources in one place.

Transactions generated over a mobile app, in a store or in an office, can all be accessed and analyzed over the cloud in nearly real-time. Many companies already use analytics to identify normal sales patterns. They know, for example, how each product sells every day of the week, in which zip codes and at what prices. Once they know what normal sales look like, they can sniff out aberrations almost immediately — before they become multi-million-dollar security breaches.

We can also use analytics to look for typical patterns of behavior. If a specific customer usually logs on to a commerce site over her phone and spends no more than $140, the merchant and the customer can immediately be alerted to someone logged on to the site under her account from a dial-up connection and spending upwards of $600.

Fraud is a daunting issue, but we have the tools and technology to tackle it. With the proper prevention system in place, organizations can avoid unnecessarily expensive, crippling problems later on. This will be an ongoing challenge for businesses and government agencies, but it shouldn’t cost tens of billions of dollars or cause major problems for millions of Americans.

Source:  www.forbes.com