Commentary

Online Fraud Rises

Online-Fraud-The rate of fraudulent online transactions originating in Europe rose 1.3% from January to March 2011 compared with 2.1% between January and March 2012, and crept upward each quarter between, according to a study released Wednesday by iovation, which protects online businesses from fraud and abuse.

The United States typically follows Europe in online and mobile trends. U.S. consumers spent $161.5 billion online in 2011 -- up 13% from 2010, according to comScore.

Consumer online spending in the U.K. continues to rise. Shoppers spent $9.3 billion online in March 2012 --up 14% year-on-year and 9% sequentially, according to IMRG. The firm said mobile devices used to shop rose 254% year-on-year, although conversion rates remain low. In March 2012, conversion rates on mobile doubled from the year-ago month, from 0.7% to 1.4%, respectively.

While iovation supports fraud prevention in the U.S., 43% of its business originates outside the United States. The top three European countries for online fraud during the last year were Romania, Lithuania and Croatia, according to iovation. From April 2011 to April 2012, iovation stopped about 15 million fraudulent online transactions in Europe. To keep pace with demand from European businesses combating this growth in fraud, iovation also announced today that it has launched its new European data center.

The company's software, ReputationManager 360, helps to expose hidden relationships between mobile phones, tablets and computers, identifying the online devices.

A European data center offers advantages, according to the company. It optimizes load times and provides additional redundancy and geographic distribution of iovation’s Device Print recognition technology, for example.

Europe’s migration to credit cards with semiconductor chips has led to criminals focusing more on e-commerce to make fraudulent purchases.

The ReputationManager 360 platform helped the Kirkland, Wash. police department stop a fraud ring in March, which began in January 2011, with a report of $5,000 in fraudulent charges victimizing 15 people via credit card at a large electronics store and two department stores.

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