Merchant fraud risk score

• US 8,626,663 B2
• Filed: 03/22/2011
• Issued: 01/07/2014
• Est. Priority Date: 03/23/2010
• Status: Active Grant

• Current Assignee: Visa International Service Association (Visa, Inc.)
• Original Assignee: Visa International Service Association (Visa, Inc.)
• Inventors: Nightengale, Brad, Newland, Karl, Siegel, Kevin, Rowberry, Sharon, Jiang, Zhongxiao (Josh)
• Primary Examiner(s): Akintola, Olabode
• Assistant Examiner(s): Vyas, Abhishek
• Application Number:
  US13/053,504
• Publication Number:
  US 20110238575A1
• Time in Patent Office: 1,022 Days
• Field of Search: 705 44- 45
• US Class Current: 705/44
• CPC Class Codes: G06Q 20/20 Point-of-sale [POS] network systems
• 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: H04L 2101/668 Internet protocol [IP] address subnets
• CPC Class Codes: H04L 61/5007 Internet protocol [IP] addresses

Abstract

Methods and systems are presented for a fraud risk score to be given to a merchant for a proposed transaction with a consumer. The fraud risk score is generated by a payment account service provider, such as a credit card processor, using information from a pending transaction as well as information from other payment accounts that the consumer holds to which the payment account service provider is privy. Various factors, including indicators of elevated risk in other payment accounts, are custom-weighted by the merchant for the score.

Claims

1. A method comprising:

receiving from a merchant an authorization request message for a payment from a first payment account, the authorization request message specifying at least a portion of a billing address and a portion of a shipping address;

identifying a mismatch between the billing address and the shipping address;

ascertaining that the first payment account is associated with a second payment account, the second payment account experiencing an elevated risk, wherein the association between the first and second payment accounts arise from a common billing address;

determining, using a processor operatively coupled to a memory, a fraud risk score based on weighting the mismatch and the elevated risk of the second payment account using a weighting specified by the merchant;

inserting the fraud risk score in an authorization approval message; and

sending the authorization approval message with the fraud risk score to the merchant in response to the authorization request message.

2. The method of claim 1 wherein the authorization request message further specifies an internet protocol (IP) address, the method further comprising:

determining an inconsistency between a geographic location of the IP address and the billing or shipping address;

determining the fraud risk score based on weighting the inconsistency, mismatch, and elevated risk using the weighting specified by the merchant.

3. The method of claim 1 wherein the authorization request message further specifies a product identifier, the method further comprising:

determining a product-related risk of fraud associated with the product identifier;

determining the fraud risk score based on weighting the product-related risk, inconsistency, and elevated risk using the weighting specified by the merchant.

4. The method of claim 3 wherein the product identifier includes a stock keeping unit (SKU).

5. The method of claim 1 wherein the authorization request message further specifies a customer name, the method further comprising:

determining a negative list match of the customer name with a name on a negative list, the negative list specified by the merchant;

determining the fraud risk score based on weighting the negative list match, inconsistency, and elevated risk using the weighting specified by the merchant.

6. The method of claim 1 wherein the association between the first and second payment accounts arise from ownership by at least one customer in common.

7. The method of claim 1 wherein the merchant-specified weighting is entered by the merchant.

8. The method of claim 1 wherein the fraud risk score is a two-digit number and the payment accounts are payment card accounts.

9. The method of claim 1 wherein each operation is performed by the processor operatively coupled to a memory.

14. The method of claim 1 further comprising:

determining whether a score was inserted in an authorization approval message; and

billing the merchant based on a determination that the score was inserted in the authorization approval message.

10. A non-transitory machine-readable tangible storage medium embodying information indicative of instructions for causing one or more machines to perform operations comprising:

receiving from a merchant an authorization request message for a payment from a first payment account, the authorization request message specifying at least a portion of a billing address and a portion of a shipping address;

identifying a mismatch between the billing address and the shipping address;

ascertaining that the first payment account is associated with a second payment account, the second payment account experiencing an elevated risk, wherein the association between the first and second payment accounts arise from a common billing address;

determining, using a processor operatively coupled to a memory, a fraud risk score based on weighting the mismatch and the elevated risk of the second payment account using a weighting specified by the merchant;

inserting the fraud risk score in an authorization approval message; and

sending the authorization approval message with the fraud risk score to the merchant in response to the authorization request message.

11. A computer system comprising a processor executing instructions in a computer program, the computer program instructions comprising program code for performing operations comprising:

receiving from a merchant an authorization request message for a payment from a first payment account, the authorization request message specifying at least a portion of a billing address and a portion of a shipping address;

identifying a mismatch between the billing address and the shipping address;

ascertaining that the first payment account is associated with a second payment account, the second payment account experiencing an elevated risk, wherein the association between the first and second payment accounts arise from a common billing address;

determining, using a processor operatively coupled to a memory, a fraud risk score based on weighting the mismatch and the elevated risk of the second payment account using a weighting specified by the merchant;

inserting the fraud risk score in an authorization approval message; and

sending the authorization approval message with the fraud risk score to the merchant in response to the authorization request message.

12. A method comprising:

receiving from a merchant an authorization request message for a payment from a payment account of an accountholder;

identifying an elevated risk from data in the authorization request message indicating a mismatch between at least a portion of a billing address of the payment account and a portion of a shipping address associated with the payment;

ascertaining an elevated risk corresponding to another payment account of the accountholder having a same billing address as the payment account for the payment;

determining, using a processor operatively coupled to a memory, a fraud risk score based on a merchant-specified weighting of the elevated risk from data in the authorization message indicating the mismatch of the billing address and shipping address portions and elevated risk corresponding to another payment account of the accountholder;

inserting the fraud risk score in an authorization approval message; and

sending the authorization approval message with the fraud risk score to the merchant in response to the authorization request message.

13. The method of claim 12 wherein the merchant-specified weighting is entered by the merchant.

15. The method of claim 12 further comprising:

determining whether a score was inserted in an authorization approval message; and

billing the merchant based on a determination that the score was inserted in the authorization approval message.