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Clearsale Blog

Understand why human analysis is so important for fraud management

By Clearsale

Clearsale Blog Posts

Understand why human analysis is so important for fraud management

Helen just moved to a new city. Unfortunately, she lost her credit card and had to buy an appliance using a friend's card. Despite her friend’s excellent history with the store, the transaction was turned down. The fraud control solution analyzed the card data, the e-mail address and the new address and considered it a high-risk transaction, issuing an automatic denial. There was no assessment of the context and the store lost an excellent client.

This fictitious example shows how important human analysis is for proper fraud analysis. Many companies experience this dilemma on a daily basis, using automated prevention exclusively. But what would really resolve issues such as this is a combination of cutting-edge technology and specialized human analysis that can, for instance, check if the voice is consistent with the buyer's age and gender, his/her origin or if the alleged buyer is actually a fraudster, not only based on fraud patterns, but also by putting data into context and relying on analyst knowledge and feeling. In a highly competitive market, this distinction ensures not only satisfaction, but can also directly impact new business.

Do you think we are exaggerating? Think again. Put yourself in Helen's place and think how frustrated she felt when she couldn't buy the item she needed. She is likely to use social networks – Twitter and Facebook to post negative comments about the store. People she knows will "like" her comments and share them with hundreds of others, creating a snowball effect. The result is that the company will end up suffering a financial loss, and its image will be impaired. All of this could have been avoided by adding human analysis. "Our primary goal is always to authenticate buyers. We combine technology and fraud experts to look for good buyers. This is an investment that will contribute to the future sustainability of the business," said Operations Manager Gabriel Firer. The advantages of this model are huge. "They range from better fraud indicators, higher sales convergent and an excellent market image," he added.

Choosing the right partner

 “Numerous factors go into selecting the best partner. We have to take into consideration how many people are actually involved in risk analysis. Because it is such a critical activity, Ideally, your partner will have a stable team (low turnover), with long-term in-house anti-fraud experience," he added. It is also important to check that these professionals are qualified experts. Oftentimes companies use generic teams, which compromises prevention efficiency. Professional development is something else to look for. Ask questions about training and update frequency. "Fraudsters are increasingly creative. Experts should be no different. They must be capable of picking up what is abnormal and fraudulent behavior to preserve the good buyers and the company's bottom line".

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