How to block fraud credit / debit cards?

Question

I'm not sure if this is the right place to ask this question not, Please do let me know where I can try.

I'm having a real concern for blocking / disallow the usage of fraud transactions in our platform.

Some of customer uses some of fraud or stolen card to make payment in our platform and they keep doing it on daily basis. Its not one or two cards. Its like many (say more than 50 a day).

As We are not payment company So We don't a license to store the card details in DB and block the card if same card is appears again.

Weird thing is these customer's are able to pass 3D secure page protected by bank website, which ask for real user's OTP for that transaction.

Update: Though I'm blocking customer's account and there android device Ids If found suspicious user.

Is there any way I can reduce or stop these frauds?

Answer 1

For your issue, try to collect the data (be sure to ask the customers' permissions):

• credit card BIN (you can use it to find out the issuer bank and card country)
• IP subset and customer timezone (you can use it to find out is the customer use anonymizer like proxy, VPN, TOR)
• device fingerprint (mobile or browser)
• information about the used 3DS protocol and bank's operation result code (there are static - not dynamic - 3DS codes in some banks, or you can incorrect processing operation result code).

After you gather these data you can apply the following approaches to fraud prevention:

1. Rule-based anti-fraud:
   • Black/white lists (countries, IP addresses, card BINs)
   • Statistics-based approach (for example, if more than 3 accounts use the same credit card then )
2. ML-based anti-fraud:
   • Fraud prediction using Supervised Machine Learning methods
   • Anomaly detection using Unsupervised Machine Learning methods.

And of course, you can use Anti-fraud as a Service (3rd party services) to solve your issue.