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Online merchants face difficulties in using existing card fraud detection algorithms, so in this paper we propose a novel proactive fraud detection model using what we call invariant diversity to reveal patterns among attributes of the devices (computers or smartphones) that are used in conducting the transactions. The model generates a regression function from a diversity index of various attribute combinations, and use it to detect anomalies inherent in certain fraudulent transactions. This approach allows for proactive fraud detection using a relatively small number of unsupervised transactions and is resistant to fraudsters' device obfuscation attempt. We tested our system successfully on real online merchant transactions and it managed to find several instances of previously undetected fraudulent transactions.
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Using Disposable Domain Names to Detect Online Card Transaction Fraud
Online card transaction fraud is one of the major threats to the bottom line of E-commerce merchants. In this paper, we propose a novel method for online merchants to utilize disposable (“one-time use”) domain names to detect client IP spoofing by collecting client's DNS information during an E-commerce transaction, which in turn can help with transaction fraud detection. By inserting a dynamically generated unique hostname on the E-commerce transaction webpage, a client will issue an identifiable DNS query to the customized authoritative DNS server maintained by the online Merchant. In this way, the online Merchant is able to collect DNS configuration of the client and match it with the client's corresponding transaction in order to verify the consistency of the client's IP address. Any discrepancy can reveal proxy usage, which fraudsters commonly use to spoof their true origins. We have deployed our preliminary prototype system on a real online merchant and successfully collected clients DNS queries correlated with their web transactions; then we show some real instances of successful fraud detection using this method. We also address some concerns regarding the use of disposable domains.
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- PAR ID:
- 10094480
- Date Published:
- Journal Name:
- ICC 2019 - 2019 IEEE International Conference on Communications (ICC)
- Page Range / eLocation ID:
- 1 to 7
- Format(s):
- Medium: X
- Sponsoring Org:
- National Science Foundation
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- Free Publicly Accessible Full Text
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Accepted Manuscript1.0
- Conference Paper:
- https://doi.org/10.1109/ICC.2019.8761144
