System and Method Using Enhanced Authorization Data to Reduce Travel-Related

• US 20070282674A1
• Filed: 02/09/2005
• Published: 12/06/2007
• Est. Priority Date: 02/09/2004
• Status: Active Grant

• Current Assignee: Liberty Peak Ventures, LLC (Dominion Harbor Enterprises, LLC)
• Original Assignee: American Express Travel Related Services Company, Inc. (American Express Company)
• Inventors: Marshall, Vernon, Gomes, Kristin, Goulden, Stuart, Webb, Ian, Mohanty, Sabyasachi
• Granted Patent: US 8,386,376 B2
• Time in Patent Office: Days
• US Class Current: 705/13
• CPC Class Codes: G06Q 10/02 Reservations, e.g. for tickets, services or events
• CPC Class Codes: G06Q 20/12 specially adapted for electronic shopping systems
• CPC Class Codes: G06Q 20/24 Credit schemes, i.e. "pay after"
• CPC Class Codes: G06Q 20/40 Authorisation, e.g. identification of payer or payee, verification of customer or shop credentials; Review and approval of payers, e.g. check credit lines or negative lists
• CPC Class Codes: G06Q 20/4016 involving fraud or risk level assessment in transaction processing
• CPC Class Codes: G06Q 30/06 Buying, selling or leasing transactions

Abstract

Processes (200, 400) for reducing fraud risk in credit transactions, particularly those involving airline ticket purchases, includes collecting the following additional transaction variables and their use in real-time authorization decisions: credit card holder name, reservation code, passenger name, origin city, destination city, travel date, routing description, class of service, e-ticket indicator, number of passengers traveling and carrier code. The additional transaction variables received during a transaction involving the purchase of airline tickets are passed, in addition to the transaction variables traditionally included in a real-time authorizations request, to a fraud risk evaluation model maintained by a financial institution (106) or other entity responsible for authorizing a payment for the transaction. The fraud-risk models use historical behavior and optimal risk decision-making factors to authorize or reject the transaction in real time, without slowing standard authorization processing times.

Claims

1. A method for authorizing a financial transaction between a merchant and an account holder of a financial account, comprising:

receiving, from the merchant for use in real-time authorization, transaction variables for a transaction involving a purchase of a travel ticket using the financial account, the transaction variables including a passenger name on the travel ticket, a travel date, a routing description of the travel ticket, and an electronic ticket indicator; and

processing the transaction variables through a fraud-risk model to determine a risk factor for the transaction.

2. The method of claim 1, further comprising:

approving the transaction when the risk factor is within a range of acceptable values.

3. The method of claim 2, said approving further comprising:

retrieving a purchasing history of the account holder; and

approving the transaction based on the risk factor and the purchasing history.

4. The method of claim 2, said approving further comprising:

retrieving a status of the financial account; and

approving the transaction based on the risk factor and the status.

5. The method of claim 1, further comprising:

declining the transaction when the risk factor is within a range of unacceptable values.

6. The method of claim 1, further comprising:

transmitting a request to contact a financial institution maintaining the financial account when the risk factor is within a range of unacceptable values.

7. The method of claim 1, further comprising:

retrieving a purchasing history of the account holder; and

declining the transaction based on the purchasing history.

8. The method of claim 1, further comprising:

retrieving a status of the financial account; and

declining the transaction based on the status.

9. The method of claim 1, the fraud-risk model comprising a combination of risk values assigned to the transaction variables, the risk values determined from historical data of prior transactions involving a plurality of account holders.

10. The method of claim 1, the fraud-risk model comprising a combination of risk values determined for various comparisons of the transaction variables, the risk values determined from historical data of prior transactions involving a plurality of account holders.

11. The method of claim 10, wherein a risk value of a comparison of a name of the account holder and the passenger name indicates a higher risk when the name of the account holder does not match the passenger name, and indicates a lower risk when the name of the account holder matches the passenger name.

12. The method of claim 1, wherein the transaction variables are received in a standard format so that a processing time of the transaction is not greater than a standard processing time for transactions that do not involve the purchase of travel tickets.

13. The method of claim 1, the financial account comprising one of:

a credit card account, a charge card account and a debit account.

14. The method of claim 1, the transaction variables further comprising:

an origin city for the travel ticket, a destination city, a class of service of the travel ticket, and a number of passengers traveling.

15. The method of claim 1, the transaction variables comprising:

a name of the account holder, a reservation code of the ticket, and a carrier code.

16. A method for authorizing a transaction between a merchant and an account holder having a financial account, the transaction involving a purchase of an airline ticket, the method comprising:

transmitting, to a transaction processor, transaction variables for the transaction, the transaction variables including a passenger name on the airline ticket, a travel date, a routing type of the airline ticket, and an electronic ticket indicator; and

receiving, from the transaction processor, one of an approval of the transaction, a declination of the transaction and a request to contact a financial institution maintaining the financial account, based on the transaction variables.

17. The method of claim 16, wherein the transaction variables are processed by the transaction processor through a fraud-risk model comprising a combination of risk values assigned to the transaction variables, the risk values determined from historical data of prior transactions involving a plurality of account holders.

18. The method of claim 16, wherein the transaction variables are processed by the transaction processor through a fraud-risk model comprising a combination of risk values determined for various comparisons of the transaction variables, the risk values determined from historical data of prior transactions involving a plurality of account holders.

19. The method of claim 18, wherein a risk value of a comparison of the name of the account holder and the passenger name indicates a higher risk when a name of the account holder does not match the passenger name, and indicates a lower risk when the name of the account holder matches the passenger name.

20. The method of claim 16, wherein the transaction variables are transmitted in a standard format so that a processing time of the transaction is not greater than a standard processing time for transactions that do not involve the purchase of airline tickets.

21. The method of claim 16, wherein the merchant comprises at least one of:

an online travel vendor, an airline carrier and a travel agent.

22. The method of claim 16, the transaction variables further comprising:

an origin city for the travel ticket, a destination city, a class of service of the travel ticket, and a number of passengers traveling.

23. The method of claim 16, the transaction variables comprising:

a name of the account holder, a reservation code of the ticket, and a carrier code.

24. A method for generating and applying a fraud-risk model to financial transactions involving purchases of airline tickets by account holders from merchants, the method comprising:

determining, based on historical data, a risk value for transaction variables of transactions involving purchases of airline tickets, the transaction variables including at least one of;

an account holder name, a reservation code, a passenger name, an origin city, a destination city, a travel date, a routing description, a class of service, an electronic ticket indicator, a number of passengers traveling and a carrier code;

combining the risk values to generate a fraud-risk model that determines risk factors for transactions involving purchases of airline ticket;

receiving a request from a merchant to authorize a transaction involving a purchase of a ticket by an account holder, the request including transaction variables corresponding to the account holder and the ticket;

determining a risk factor for the transaction by inputting the transaction variables corresponding to the account holder and the ticket to the fraud-risk model; and

generating an authorization decision for the request based on the risk factor for the transaction.

25. A method for authorizing a financial transaction between a merchant and an account holder of a financial account, comprising:

receiving, from the merchant for use in real-time authorization, transaction variables for a transaction involving a purchase of a travel ticket using the financial account, the transaction variables including at least one of;

a passenger name on the travel ticket, a travel date, a routing description of the travel ticket, and an electronic ticket indicator; and

processing the transaction variables through a fraud-risk model to determine a risk factor for the transaction.