2014-2015 David Dewey, Director of Research Pindrop Security July - PowerPoint PPT Presentation

THE STATE OF RETAIL PHONE FRAUD 2014-2015 David Dewey, Director of Research Pindrop Security July 23, 2015 2015 Pindrop Security ™ . Confidential.

METHODOLOGY Phoneprinting TM Phoneypot TM Topic Modeler 100m+ Enterprise Calls 500k+ Unlisted Numbers 45m+ Consumer Complaints 2015 Pindrop Security ™ . Confidential. 2015 Pindrop Security ™ . Confidential.

RISK FACTORS Customer Service Business Accounts Fencible Goods Phone Orders, Help Line Schools, Hospitals, Enterprise Electronics, Phones, Toner 2015 Pindrop Security ™ . Confidential. 2015 Pindrop Security ™ . Confidential.

RETAIL PHONE FRAUD ATTACKS 2015 Pindrop Security ™ . Confidential.

CARD NOT PRESENT FRAUD (CNP) Attacker orders with Consumer disputes Chargeback is Retailer ships order stolen card charges issued Lost Merchandise 2015 Pindrop Security ™ . Confidential.

CARD NOT PRESENT FRAUD (CNP) Attacker orders with Consumer disputes Chargeback is Retailer ships order stolen card charges issued Lost Merchandise Lost Shipping And Handling 2015 Pindrop Security ™ . Confidential.

CARD NOT PRESENT FRAUD (CNP) Attacker orders with Consumer disputes Chargeback is Retailer ships order stolen card charges issued Lost Merchandise Lost Shipping Lost Reputation And Handling 2015 Pindrop Security ™ . Confidential.

CARD NOT PRESENT FRAUD (CNP) Attacker orders with Consumer disputes Chargeback is Retailer ships order stolen card charges issued Lost Merchandise Lost Shipping Lost Reputation Lost Chargeback And Handling Fees & Penalties 2015 Pindrop Security ™ . Confidential.

FRIENDLY FRAUD / CHARGEBACK FRAUD Consumer places Consumer disputes Chargeback is Retailer ships order order charges issued Lost Merchandise Lost Shipping Lost Chargeback & Handling Fees & Penalties 2015 Pindrop Security ™ . Confidential.

BUSINESS ACCOUNT TAKEOVER Attacker impersonates Business disputes Chargeback is Retailer ships order business to place charge issued Purchase Order Lost Merchandise Lost Shipping Lost Reputation Lost Chargeback & Handling Fees & Penalties 2015 Pindrop Security ™ . Confidential.

ACQUIRING THE SHIPMENT Shipment Intercept In Store Pickup Reshipping 2015 Pindrop Security ™ . Confidential.

DATA BREACHES • Reconnaissance over the phone is the first step in a data breach • 4 out of 5 fraud calls are not money transactions Weapon- Recon Delivery Exploit Install C&C Action ization Lockheed Martin Cyber Kill Chain 2015 Pindrop Security ™ . Confidential.

RETAIL PHONE FRAUD BY THE NUMBERS 2015 Pindrop Security ™ . Confidential.

THE THREAT IS GROWING 2015 Pindrop Security ™ . Confidential. 2015 Pindrop Security ™ . Confidential.

1 IN 1,000 CALLS IS FRAUD Fraud Calls .12% .10% .08% .06% .04% .02% Retail Avg. Call Center 2015 Pindrop Security ™ . Confidential. 2015 Pindrop Security ™ . Confidential.

FRAUD LOSS • Average fraud loss per call • Does not include: • Operational Costs • Processing Costs • Shipping Costs $0.17 2015 Pindrop Security ™ . Confidential. 2015 Pindrop Security ™ . Confidential.

FRAUD ORDERS • Average value of fraudulent orders per call • Some fraud is caught before the items are shipped $0.65 $0.17 2015 Pindrop Security ™ . Confidential. 2015 Pindrop Security ™ . Confidential.

FRAUD EXPOSURE • The value of the stolen $2.40 account • The amount of in-store credit $0.65 offered • Non-monetary attacks • Social Engineering $0.17 • Reconnaissance • Privacy Breaches 2015 Pindrop Security ™ . Confidential. 2015 Pindrop Security ™ . Confidential.

BEST PRACTICES ANOMALY MULTIFACTOR TRANSPARENT EVERY CALL COLLABORATIVE DETECTION Fast, behind the Function in adverse Examine multiple Share info across scenes Detect fraud on the conditions, on all or aspects of call for organizations first call most calls accuracy 2015 Pindrop Security ™ . Confidential. 2015 Pindrop Security ™ . Confidential.

PHONEPRINTING™ LOSS • Packet loss • Robotization • Dropped frames Call Audio Requires 15 seconds SPECTRUM of call audio • Quantization • Frequency filters • Codec artifacts 147 audio features NOISE • Clarity • Correlation Phoneprint™ • Signal-to-noise ratio Risk Score 86 Phone Type Geo-Location Other Risk Factors 2015 Pindrop Security ™ . Confidential. 2015 Pindrop Security ™ . Confidential.

PINDROP SECURITY Phone Fraud Stops Here. For more information contact info@pindropsecurity.com 2015 Pindrop Security ™ . Confidential.