Multi-level fraud check with dynamic feedback for internet business transaction processor

• US 7,139,731 B1
• Filed: 06/30/1999
• Issued: 11/21/2006
• Est. Priority Date: 06/30/1999
• Status: Expired due to Term

• Current Assignee: Consolidated Transaction Processing LLC (Equitable IP Corporation)
• Original Assignee: Mount Hamilton Partners, LLC (Innovation Management Sciences, LLC)
• Inventors: Alvin, Robert S.
• Primary Examiner(s): NGUYEN, CUONG H
• Application Number:
  US09/343,550
• Time in Patent Office: 2,701 Days
• Field of Search: 705/26, 705/27, 705/76, 705/38, 705/35, 705/42, 705/44, 705/70, 705/75
• US Class Current: 705/35
• CPC Class Codes: G06Q 10/087 Inventory or stock management, e.g. order filling, procurement or balancing against orders
• CPC Class Codes: G06Q 20/108 Remote banking, e.g. home banking
• CPC Class Codes: G06Q 20/3821 Electronic credentials
• 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 30/0207 Discounts or incentives, e.g. coupons or rebates
• CPC Class Codes: G06Q 30/0222 During e-commerce, i.e. online transactions
• CPC Class Codes: G06Q 30/0251 Targeted advertisements
• CPC Class Codes: G06Q 30/0253 During e-commerce, i.e. online transactions
• CPC Class Codes: G06Q 30/0261 based on user location
• CPC Class Codes: G06Q 30/0269 based on user profile or attribute
• CPC Class Codes: G06Q 30/06 Buying, selling or leasing transactions
• CPC Class Codes: G06Q 30/0601 Electronic shopping [e-shopping]
• CPC Class Codes: G06Q 30/0603 Catalogue ordering
• CPC Class Codes: G06Q 30/0637 Approvals
• CPC Class Codes: G06Q 40/00 Finance; Insurance; Tax strategies; Processing of corporate or income taxes
• CPC Class Codes: G06Q 40/03 Credit; Loans; Processing thereof

Abstract

An Internet business transaction processor of the present invention has a distributed processing architecture which allows the processing load to be distributed among multiple parallel servers. The transaction processor of the present invention provides a virtual store front utilizing “others people'"'"'s warehouse” approach by using a dynamic distributor selection processing system to select among a plurality of distributors based on flexible rule-based algorithm. Furthermore, a multi-level fraud check processing system allows orders to be processes that would otherwise be discarded to generate a higher yield in sales.

Claims

1. An improved internet-centric electronic transaction processor for automating and facilitating retail sale of ones of a plurality of selected products to retail customers directly from a distributor of said products comprising:

a database for storing catalog-type product data for a plurality of selected products;

a communication interface for selectively permitting a retail customer to selectively access said catalog-type product data stored in said database;

an electronic order form for permitting said retail customer to place a purchase order for ones of said selected products;

an order processor for processing said purchase orders for ones of said selected products, said order processor including

a payment authorization processor for checking the credit worthiness of a purchase method of payment before said purchase order is authorized for fulfillment, said payment authorization processor having

a data integrity checker for checking the integrity of said order to determine if the purchase order should be accepted or rejected,

a gross fraud checker for checking the accepted orders from said data integrity checker for fraud based on fraud information stored in said database to determine if the purchase order should be accepted or rejected,

a commercial authorization service for generating a fraud score of the orders accepted by the fraud checker, and

a comparator for comparing said fraud score with a predetermined threshold to determine if the purchase order should be accepted or rejected, and

a distributor authorization processor for authorizing said distributor to fulfill said purchase ordering and authorizing to ship said ordered product to said customer in a manner transparent to said customer; and

a payment processor for billing said retail customer for said ordered product when authorized for shipment.

2. The improved internet-centric electronic transaction processor of claim 1, further comprising:

a sorting bin for storing the rejected purchase orders and sorting the rejected purchase orders to be altered and reprocessed.

3. An improved internet-centric electronic transaction processor of claim 2, where in rejected purchases are subjected to human review.

4. An improved internet-centric electronic transaction method executable by a computer for facilitating automated retail sales of ones of a plurality of selected products to retail customers directly from a distributor of said products comprising the steps of:

generating a catalog-type product data for said products in a selectively addressable database;

permitting ones of said retail customers to selectively access said product data stored in said database and allowing said retail customers to submit purchase orders of said selected products;

processing said purchase orders for ones of said retail customers by determining if said selected product is available from a distributor'"'"'s inventory stock and authorizing the distributor to ship said selected product to said retail customer in a manner that is transparent to the retail customer;

authorizing said purchase order based on a credit worthiness check of information supplied by said retail customer in connection with said purchase order, said authorizing step including the steps of

performing a data integrity check to determine if the purchase order should be accepted or rejected,

performing a gross fraud check on accepted orders using fraud information stored in said database initially determine if the order should be accepted or rejected,

performing a commercial fraud check on accepted orders to generate a fraud score, and

comparing the fraud score with a predetermined threshold to either accept or reject said purchase order, and

billing said retail customer for said order product when said distributor has been authorized to ship such order product to said retail customer.

5. The improved internet-centric transaction method of claim 4, further including the step of

sorting said rejected purchase orders to be altered and reprocessed.