With fraud emerging as the number one threat to their industry, a group of e-commerce development companies are mounting a counter-attack. The new Internet Fraud Prevention Advisory Council, led by HNC Software, Inc. (Nasdaq: HNCS), has won widespread support as it attempts to eradicate consumer fears of buying and selling online.
IFPAC hopes to reduce the risk for both e-commerce companies and consumers. According to PriceWaterhouseCoopers, Internet and e-commerce transactions account for half the $32 billion (US$) in annual fraud damage. Internet merchants are ultimately responsible for any losses, but IFPCA notes that these losses often translate into price increases for goods and services. In addition, the council said, online merchants with consistently high fraud rates may lose the right to accept credit cards as a form of payment.
“Many consumers are reluctant to shop online and are afraid of potential fraudulent use of their credit card account. IFPAC will help everyone involved in e-commerce become as confident as they are with transactions where the credit card is present,” HNC Software Vice President Of Internet Risk Management Allen Jost said.
About the Council
IFPAC has six charter members: HNC Software, EC Direct — an e-commerce infrastructure developer — payment processing services CyberCash, Inc. (Nasdaq: CYCH) and Signio, direct marketer ShowNow.com Inc. and ebit.net, the risk management division of Transaction Billing Resources.
The council offers advice and guidance to Internet, retail, financial and payment companies, including data on fraud trends and techniques to combat fraud. IFPAC also pledges to share information with other e-commerce fraud prevention and security groups.
eHNC, the e-commerce division of HNC Software, is also contributing the technology for the eFalcon Internet Fraud Control Consortium. This group of financial industry companies and organizations collects data for identifying and preventing Internet fraud. Online businesses that use the eFalcon service automatically become IFPAC members.