System and method for providing a card transaction authorization fraud warning
First Claim
1. A system for notifying an issuing bank of an increased risk of card fraud, comprising:
- a terminal for obtaining and transmitting transaction data corresponding to a particular transaction;
the terminal including a card reader for obtaining card identifying information relating to a card tendered in connection with the particular transaction;
a transaction processor for receiving the transaction data from the terminal and for transmitting an authorization decision to the terminal;
a monitoring means for monitoring the authorization decision, determining an actual security code, and comparing the actual security code to a transaction security code; and
the monitoring means further operating to generate a risk alarm, in response to a mismatch between the actual security code and the transaction security code when the authorization decision is a transaction approval.
8 Assignments
0 Petitions
Accused Products
Abstract
Identifying and notifying credit card issuing banks of an increased risk of credit card fraud. An early warning system assists credit card transaction processors and credit card issuing banks reduce occurrences of credit card fraud. By analyzing transaction data and credit card account information, an authorization decision is made and transmitted to the merchant. The authorization decision either approves or denies the credit card transaction. Conventional authorization systems employ a security code that can be transmitted with an authorization request to limit authorization to transactions including the proper security code. Because some issuing banks do not utilize the security code system, they are exposed to an increased risk of credit card fraud. The early warning system can be used to monitor the authorization decisions that are transmitted by the processor to the merchant. By compiling data on the occurrences of mismatches between an expected security code and the security code provided by the authorization request, the early warning system can notify processors and/or issuing banks that they are exposed to an increased risk of credit card fraud. Additionally, the early warning system can detect attempts by credit card thieves to identify exposed banks. Detected attempts at credit card fraud can also be used to initiate investigations to apprehend credit card thieves.
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Citations
21 Claims
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1. A system for notifying an issuing bank of an increased risk of card fraud, comprising:
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a terminal for obtaining and transmitting transaction data corresponding to a particular transaction;
the terminal including a card reader for obtaining card identifying information relating to a card tendered in connection with the particular transaction;
a transaction processor for receiving the transaction data from the terminal and for transmitting an authorization decision to the terminal;
a monitoring means for monitoring the authorization decision, determining an actual security code, and comparing the actual security code to a transaction security code; and
the monitoring means further operating to generate a risk alarm, in response to a mismatch between the actual security code and the transaction security code when the authorization decision is a transaction approval. - View Dependent Claims (2, 3, 4, 5, 6, 7, 8, 9, 10)
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11. A method of operating an authorization system to notify an issuing bank of its exposure to card fraud, comprising the steps of:
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receiving an authorization decision from a transaction processor;
determining an actual security code;
comparing the actual security code to a transaction security code included in the authorization decision; and
generating a risk alarm in response to a mismatch between the actual security code and the transaction security code when the authorization decision is a transaction approval. - View Dependent Claims (12, 13, 14, 15, 16)
checking a mismatch threshold; and
generating the risk alarm, in response to a determination that the mismatch threshold has been exceeded.
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17. A method of operating an authorization system to notify an issuing bank of an increased risk of card fraud, comprising the steps of:
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receiving transaction data from a transaction terminal, the transaction data corresponding to a particular transaction;
transmitting an authorization request to the issuing bank the authorization request including at least a portion of the transaction data;
receiving from the issuing bank a risk an authorization decision including a mismatch flag; and
transmitting to the issuing bank a risk alarm, in response to a determination that the mismatch flag indicates a mismatch between a transaction security code and an actual security code when the authorization decision is a transaction approval. - View Dependent Claims (18, 19, 20, 21)
checking a mismatch threshold; and
transmitting the risk alarm to the issuing bank, in response to a determination that the mismatch threshold has been exceeded.
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21. The method of claim 17, further comprising the step of storing transaction data and at least a portion of the authorization decision in an alarm database, in response to the transmission of a risk alarm.
Specification