Ethoca launches free anti-fraud service for e-retailers

Ethoca hopes making the software fee will help stem online fraud losses

Fraud detection firm Ethoca today announced the launch of new free service designed to help retailers avoid chargeback and card-not-present (CNP) fraud.

The new free service is based on Ethoca's 360 Signals technology, which works by checking online transactions in real-time against the Global Fraud Alliance (GFA) repository. This database comprises over 500m historical transactions compiled by Alliance members.

Ethoca360 Signals then identifies any matches or patterns its finds through colour-coded "Warning Signals". Those that indicate fraud risk are flagged up as "negative signals", while good transaction histories create "positive signals".

The new service launched today makes the "negative signals" part of the technology available for free, helping firms identify any previous history of chargebacks, fraud and data inconsistencies linked to a current order.

The company said it decided to make it freely available to all online merchants in an effort to broaden industry collaboration and stem online fraud losses.

Ethoca chief executive and co-founder Andre Edelbrock said that the new service would help growing numbers of online merchants to spot high-risk transactions by cross-referencing details with the GFA database.

"By collaborating on a global scale, online merchants have the ability to make fraud a problem of the past, and by making our Negative Signals service available for free, we are one step closer to making that happen," he said.

The issue is a growing one for the e-commerce space with VeriSign reporting yesterday that 11 per cent of the UK's online population fell victim to fraud last year, with individuals losing on average £352 each.