Glossary

Term
Definition
Notes

1st Party Fraud

Verify / Fraud
1st Party Fraud refers to any fraud committed against a financial institution or merchant by one of its own customers.
Source
This is usually done when applying for a product or service to receive more favorable rates, or if they have no intention of meeting their commitments. Another example could be if an individual can make a false claim against an insurer to obtain a payment they are not eligible for.

2nd Party Fraud

Verify / Fraud
Second party fraud, or money mules, is where an individual knowingly gives their identity or personal information to another individual to commit fraud.
Source
Second party fraud is difficult to detect because the person whose identity being used to commit fraud, has knowingly allowed it to happen. This means the usual characteristics associated with fraud aren't so obvious and are harder to uncover. Pipl's ability to uncover hard-to-detect "associations" between people is powerful tool in the fight against 2nd Party Fraud.

3-D Secure

Verify / Fraud
An XML-based protocol designed to be an additional security layer for online credit and debit card transactions.
Source
A customer identity validation protocol originally developed by Arcot Systems (now CA Technologies) and first deployed by Visa to reduce CNP fraud. Shoppers are required to enter a code provided by their card issuer. Its use shifts fraud liability to the credit card issuer but it's been linked to high bounce rates. Many merchants and fraud prevention platforms leverage Pipl data for targeted reductions of customer friction because it provides rich "data stories" about customers on a global scale.

3rd Party Fraud

Verify / Fraud
Third party fraud is where an individual, or group of people, use another person’s identity or personal details to open or takeover an account without the consent, or knowledge, of the person whose identity is being used.
Source
Third party fraud is a growing trend. One form is manufactured identities (Synthetic Identity Fraud) where an individual creates a new identity from stolen and false information. Up to 50% of third party fraud is seen as part of a fraud ring with activities linked to multiple identifies. Third party fraudsters acquire personal identifiable information and then use the data to take over an identity which is used to establish credit or buying products.

AML (Anti-Money Laundering)

Verify / Fraud
AML or Anti-Money Laundering refers to a set of procedures, laws or regulations designed to stop the practice of generating income through illegal activities.
Source
Most anti-money laundering programs focus on the source of funds as opposed to anti-terrorism and similar programs which focus on the destination of funds. Typically anti-money laundering programs are run by the financial institutions to analyze customer data in order to detect suspicious transactions.

AVS

Verify / Fraud
Verification system used to verify the address of a person claiming to own a credit card. The system will check the billing address of the credit card provided by the user with the address on file at the credit card company.
Source
Other security features for the credit card include the CVV2 number. AVS is used when the merchant verifies credit card data, such as billing address and ZIP code, against the billing information of the cardholder. AVS verifies that the billing address of the credit or debit card matches the address that was given by the customer. Because AVS only verifies the numeric portion of the address, certain anomalies like apartment numbers can cause false declines. Pipl’s unmatched breadth and depth of public identity information (including Address History) lowers risk, lifts approval rates and cuts their losses to fraud and chargebacks.

Account Takeover Fraud

Verify / Fraud
A form of payments fraud whereby the fraudster obtains full control over an account and locks the legitimate owner out. Usually done by changing the PIN or password, or changing the statement mailing address.
Source
Fraudsters use parts of the victim's identity such as an email address to gain access to financial accounts. They then intercept account related communications to keep the victim unaware of any threats. Victims are usually the first to detect account takeover once they discover charges or questionable withdrawals. There has been a increase in account takeovers since the adoption of EMV technology, which makes it more difficult for fraudsters to counterfeit physical credit cards.

Acquiring Financial Institution

Verify / Fraud
An acquiring financial institution, or acquirer, is a bank that processes and settles a merchant’s daily credit card transactions, and then in turn settles those transactions with the card issuer/association.
Source
All merchants are required to maintain such an account to receive payment for credit card transactions. Daily card transactions are deposited into the merchant’s account after settlement and fees are deducted. In this way, the financial institution "acquires" or serves as the intermediary to facilitate the credit transaction and pays the merchant, less a fee for the service.

Adverse Action

Verify / Fraud
An adverse action is a decision by a creditor, based on a credit score, that causes the creditor to deny a consumer access to credit, or to offer anything less than the best terms available.
Source
U.S. Federal rules require lenders to provide consumers detailed explanations of adverse actions. It means if consumers are denied credit or given less than the best terms, the lender must make available a free copy of the credit report that the decision was based on.

Algorithm

General
An algorithm is a predetermined, finite set of steps or calculations in which data are rigorously analyzed.
Source
In many Risk Management scenarios such as credit scoring and fraud detection, algorithms are the complex set of calculations that analyze and surface a person’s past credit oriented behavior to determine the level of risk that person carries for future activity.

Analysis Flags

Verify / Fraud
Outputs of technology platforms that are based on the scientific disciplines of artificial intelligence and signal processing.
Source
Decision Platform encompass machine learning, reasoning, natural language processing, speech recognition, human–computer interaction, dialog and narrative generation, among other technologies. Pipl API helps companies automatically verify and enrich identity records across their decision platforms. These global providers know from testing that Pipl’s unmatched breadth and depth of public identity information lowers risk, lifts their approval rates and cuts their losses to fraud and chargebacks.

Anomaly Detection (aka Outlier Detection)

Verify / Fraud
In data mining, anomaly detection (also outlier detection) is the identification of rare items, events or observations which raise suspicions by differing significantly from the majority of the data.
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Typically anomalous items translate to some kind of problem such as fraud. As with all computing applications, the quality and quantity of data inputs such as high quality identity data intelligence is key to successful outcomes.

Application Fraud

Verify / Fraud
Application fraud is a type of banking fraud in which a crook uses a person's personal information to apply for a credit card or other bank account in their name.
Source
Application is a growing problem for financial institutions across the world. As identity crimes continue to grow, it is increasingly difficult for FIs to determine who they are dealing with in all service channels. These identity crimes are resulting in a number of strategies as FIs make new technology investments to meet both compliance (KYC) and fraud challenges. Pipl’s deep identity profiles help you accept “thin file” applicants while detecting growing schemes like synthetic identities so you stop fraudsters from establishing, then nurturing, fake profiles and accounts.

Artificial Intelligence

General
The term "artificial intelligence" is often used to describe machines (or computers) that mimic "cognitive" functions that humans associate with the human mind, such as "learning" and "problem solving".
Source
Reported by Gartner as one of the top 10 strategic technology trends in 2019. AI is heavily leveraged by the fraud management industry. Pipl’s unmatched breadth and depth of public identity information powers AI which helps reduce risk, lift approval rates and cut losses to fraud and chargebacks. All while giving their customers a friendly, frictionless, and instantly gratifying experience.

Attack Vector

Verify / Fraud
An attack vector is a path or means by which a hacker can gain access to a computer or network server in order to deliver a payload or malicious outcome.
Source
The term is increasingly used to describe a path or means by which a fraudster finds a way to commit theft, such as Identity Theft, Synthetic Identity or an Insider Attack. Our digital world runs on trusting who is behind an online identity. But the very concept of identity has fractured into hundreds of data points that fraudsters constantly seek to exploit. That’s why Pipl is the first choice whenever companies must confirm if a person is who they claim to be.

Authentication

General
Authentication is the process of assuring that a credit card transaction has been initiated by an authorized user of that card.
Source
From the merchant’s standpoint, authentication means getting the right information from the consumer, and having it verified by the transaction network. In recent years, authentication has been stepped up by means including security codes on credit cards. Pipl offers uniquely powerful identity data for verification tools so you can confidently approve, deny or escalate transactions.

Authenticator

Verify / Fraud
An authenticator is the means used to confirm the identity of a user, that is, to perform digital authentication. A person authenticates to a computer system or application by demonstrating that he or she has possession and control of an authenticator. In the simplest case, the authenticator is a common password.
Source
More modern Authenticator services give an extra layer of protection to customers by confirming a customer’s identity during the log-in or checkout process. Two common ways to do this are Challenge Questions and Biometrics. Because Pipl data provides such a rich cluster of data points it is especially useful for Challenge Questions. Users may be asked a series of security challenge questions contained in the profile and that only they know the answer to. If the challenge questions are correctly answered, users can continue signing in to a site.

Authorization (Payment)

Verify / Fraud
An authorized transaction is a debit or credit card purchase for which the merchant has received approval from the bank that issued the customer’s payment card. Authorized transactions are a component of the electronic payment process.This involves the cardholder and numerous other entities working together to complete an electronic transaction.
Source
This process helps prevent credit card fraud. Our digital world runs on trusting who is behind an online identity. But the very concept of identity has fractured into hundreds of data points that fraudsters constantly seek to exploit. That’s why Pipl is the first choice whenever companies must confirm if a person is who they claim to be.

BIN (Bank Identification Number)

Verify / Fraud
The BIN number is primarily a card identifier and does not directly identify the bank account number/s to which the card is/are linked by the issuing entity.
Source
The leading six or eight digits of the card number comprise the issuer identification number (IIN) sometimes referred to as the "bank identification number (BIN)". The remaining numbers on the card, except the last digit, are the individual account identification number. The last digit is the Luhn check digit. IINs and PANs have a certain level of internal structure and share a common numbering scheme set by ISO/IEC 7812. Payment card numbers are composed of 8 to 19 digits.

Back door

Investigation
A backdoor is a typically covert method of bypassing normal authentication or encryption in a computer, product, embedded device (e.g. a home router).
Source
Backdoors are used for securing remote access to a computer to gain access to privileged information like passwords, corrupt or delete data on hard drives, or transfer information within autoschediastic networks.

Bail enforcement

Investigation
A term associated with Bounty Hunters and refers to the act of locating and apprehending bail-secured defendants who have jumped bail or have violated an agreement with a bail bondsman to present themselves in court for a crime of which they have been accused.
Source
It’s critical that investigators cut the time spent developing new leads, filling information gaps, unmasking tipsters and finding known associates. Pipl lets you follow hunches and speeds your investigation tasks. It quickly exposes new directions to 1) quickly locate persons of interest 2) uncover associations between people, addresses, phones and social handles 3) determine the credibility of sources, witnesses or suspects 4) track changes in historical online and offline identity information 5) connect personal, professional, and social information.

Behavioral Analytics

Verify / Fraud
Behavioral analytics is a recent advancement in business analytics that reveals new insights into the behavior of consumers on eCommerce platforms, online games, web and mobile applications, and IoT.
Source
The rapid increase in the volume of raw event data generated by the digital world enables methods that go beyond typical analysis by merging these data points with demographics (such as those provided by Pipl) and other traditional metrics that show what kind of people took what actions in the past and understanding how consumers act and why, to enable accurate predictions about how they are likely to act in the future.

Big Data

General
Big data usually describes data sets sized beyond the ability of commonly used software tools to capture, curate, manage, and process data within a tolerable elapsed time. Big data philosophy encompasses unstructured, semi-structured and structured data, however the main focus is on unstructured data.
Source
E-commerce merchants use this data to gain detailed insights into customer behavior and identify business trends. Pipl’s proprietary technology uses robust statistical models and data-rich algorithms to accurately match any piece of data about a person — name, email address, phone number, or social media username — to a comprehensive profile which includes professional, social, demographic, and contact information.

Blockchain

General
A chronological ledger of transactions that is shared on a distributed digital network.
Source
The network can be public, with unlimited access (as with bitcoin), or private and permission-based.

Botnet

General
A botnet is a number of Internet-connected devices, each of which is running one or more bots.
Source
Botnets can be used to perform distributed denial-of-service attack (DDoS attack), steal data, send spam, and allows the attacker to access the device and its connection. The owner can control the botnet using command and control (C&C) software. The word "botnet" is a combination of the words "robot" and "network". The term is usually used with a negative or malicious connotation.

Bots

General
A "software robot device".
Source
Short for software robots, this term is used to describe tools designed to carry out repetitive tasks automatically. Tech savvy fraudsters may deploy bots to target eCommerce websites, by creating fake accounts and placing orders using stolen credit card details.

Burn(er) Phone

Investigation
The term originates from the drug dealing world, and is used to describe inexpensive mobile phones designed for temporary use.
Source
Fraudsters and other criminals link an account to a disposable phone number to bypass 2FA. Today, phone numbers can be generated via burner phone apps or services. These work like prepaid phone cards, only allowing you to use them for a limited amount of time before being recirculated. Because they go through your phone’s original cellular data, they can be traced.

Bust-out fraud

Verify / Fraud
Bust-out is a form of fraud that usually involves credit cards.
Source
The scheme happens when a person establishes good credit, either under their own name or by identity theft using stolen Social Security numbers. For a period of time the Fraudster continues making on-time payments, building credit, and applying for other card accounts with higher credit limits. After credit is built, the “bust-out” takes place, wherein the fraudster maxes out all the credit accounts and ceases making payments.

CCPA

Regulatory
The California Consumer Privacy Act (CCPA) is a state statute intended to enhance privacy rights and consumer protection for residents of California, United States.
Source
The intentions of the Act are to provide California residents with the right to 1) Know what personal data is being collected about them. 2) Know whether their personal data is sold or disclosed and to whom. Say no to the sale of personal data. 3) Access their personal data. 4) Request a business to delete any personal information about a consumer collected from that consumer. 5) Not be discriminated against for exercising their privacy rights. Pipl takes privacy compliance very seriously, we are certified for the EU-US Privacy Shield to ensure that our services support GDPR compliance and we comply with applicable laws and regulations, including the California Consumer Privacy Act (CCPA).

CIFA

Investigation
The Certified Insurance Fraud Analyst (CIFA) program is an accrediting process that covers all topics that deem an analyst to be well rounded and versed in all aspects of fraud analysis.
Source
The program has a high standard for admission and testing which includes adherence to IASIU’s code of ethics.

CNA

Investigation
Customer Name and Address; usually obtained from a phone number.
Source
CNA is a common and early type of lead followed by an investigator and is the act of connecting a person's name to a accurate Address location. Pipl lets you follow hunches and speeds your investigation tasks. It quickly exposes new directions to 1) quickly locate persons of interest 2) uncover associations between people, addresses, phones and social handles 3) determine the credibility of sources, witnesses or suspects 4) track changes in historical online and offline identity information 5) connect personal, professional, and social information.

Card Testing / "Carding"

Verify / Fraud
A practice employed by fraudsters to check that stolen credit card details are valid, before attempting a bigger purchase.
Source
When testing cards, fraudsters make multiple low-value purchases to stealthily avoid having the orders flagged by fraud scoring tools. Not-for-Profit sites are often targeted because giving an online donation does not require a shipping address, and because fraudsters know nonprofits are unlikely to have top notch fraud detection safeguards in place.

Card-Not-Present (CNP)

Verify / Fraud
A card not present transaction (CNP, MO/TO, Mail Order / Telephone Order, MOTOEC) is a payment card transaction made where the cardholder does not or cannot physically present the card for a merchant's visual examination at the time that an order is given and payment effected. It is most commonly used for payments made over Internet, but also mail-order transactions by mail or fax, or over the telephone.
Source
This payment method is convenient for customers and essential to online retailers — but it’s also vulnerable to fraud. Global Fraud Prevention providers and merchants know from testing that Pipl’s unmatched breadth and depth of public identity information lowers risk, lifts their approval rates and cuts their losses to fraud and chargebacks. All while giving their customers a friendly, frictionless, and instantly gratifying experience.

Cart Abandonment (Cart Abandonment Rate)

Verify / Fraud
Abandonment rate as a marketing metric helps marketers to understand website user behavior. Specifically, abandonment rate is defined as "the percentage of shopping carts that are abandoned" prior to the completion of the purchase.
Source
The typical shopping cart abandonment rate for online retailers varies between 60% and 80%, with an average of 67.91%. It is claimed that the best optimized checkout process has an abandonment rate of 20%. To achieve such optimization, Pipl data is often used to streamline the Identity Verification process (a major contributor to customer friction) once an order is placed.

Catfishing

Verify / Fraud
A form of social engineering where fraudsters and criminals create fake online identities to lure people into emotional or romantic relationships for personal or financial gain.
Source
Online seduction and blackmail are used to acquire personal information such as credit card numbers, social security numbers, or home addresses, among others.

Certified Fraud Examiner

Verify / Fraud
The Certified Fraud Examiner (CFE) is a qualification issued by the Association of Certified Fraud Examiners (ACFE).
Source
The ACFE organization is a provider of anti-fraud education and training. CFE training includes teaching about information on difficult financial transactions and appreciating forensic approaches, regulation, and deciding on claims of fraud.

Chain of Custody

Investigation
In legal context, is the chronological documentation or paper trail that records the sequence of custody, control, transfer, analysis, and disposition of physical or electronic evidence.
Source
Maintaining a chain of custody is essential for team members working on a specific criminal case. The documentation of evidence is key for maintaining a chain of custody because everything that is done to the piece of evidence must be listed and whoever came in contact with that piece of evidence is accountable for what happens to it. This prevents police officers and other law officials from contaminating the evidence or taking the piece of evidence.

Chargeback

Verify / Fraud
Chargeback is a return of money to a payer. Most commonly the payer is a consumer. The chargeback reverses a money transfer from the consumer's bank account, line of credit, or credit card. The chargeback is ordered by the bank that issued the consumer's payment card.
Source
The chargeback mechanism exists primarily for consumer protection. Holders of credit cards issued in the United States are afforded reversal rights by the Truth in Lending Act. United States debit card holders are guaranteed reversal rights by the Electronic Fund Transfer Act. Similar rights extend globally, pursuant to the rules established by the corresponding card association or bank network. A consumer may initiate a chargeback by contacting their issuing bank and filing a substantiated complaint regarding one or more debit items on their statement. The threat of forced reversal of funds provides merchants with an incentive to provide quality products, helpful customer service, and timely refunds as appropriate.

Chargeback Fees

Verify / Fraud
If a merchant encounters a chargeback they may be assessed a fee by their acquiring bank. A potential chargeback is presented on behalf of the card holder's bank to the merchant's credit card processing bank.
Source
Currently, both Visa and MasterCard require all merchants to maintain no more than 1% of dollar volume processed to be chargebacks. If the percentage goes above, there are penalties starting at $5,000 – $25,000 charged to the merchant's processing bank and ultimately passed on to the merchant. In all cases, a chargeback will cost the merchant the chargeback fee, typically $15–$30, plus the cost of the transaction and the amount processed. Pipl data plays an important role in reducing merchant chargeback losses in both automated (API) and manual review (SEARCH) approaches.

Chargeback Fraud (aka Friendly Fraud)

Verify / Fraud
Chargeback fraud occurs when a consumer makes an online shopping purchase with their own credit card, and then requests a chargeback from the issuing bank after receiving the purchased goods or services.
Source
For superior investigation of Chargeback Fraud, Pipl’s identity resolution engine accurately clusters a vast array of hard-to-connect identity information not found by standard research tools. With well structured reports, important facts are front and center so CBF investigators can quickly dig into details all on one page or use shortcuts to jump to social media accounts and web links.

Chargeback Insurance

Verify / Fraud
Chargeback insurance is an insurance product that protects a merchant who accepts credit cards. The insurance protects the merchant against fraud in a transaction where the use of the credit card was unauthorized, and covers claims arising out of the merchant's liability to the service bank.
Source
A typical chargeback insurance policy will only cover losses on credit card transactions purchased through its own specific payment processor or payment gateway. While chargeback insurance can help cover losses, like any insurance there are pros and cons. While some fraud protection services charge a flat-rate fee per transaction (typically 0.5 to 15 cents per transaction), vendors who offer chargeback insurance usually charge a percentage-based fee of 0.5% to 1.5% which can be cost-prohibitive for larger transactions.

Chargeback Ratio

Verify / Fraud
A merchant’s chargeback ratio is the number of chargebacks compared to overall transactions for a given month. As the number of chargebacks against a retailer rises, so does the ratio.
Source
Most credit card companies require that chargeback ratios be less than 1 percent; after 1 percent, merchants may be placed in a “excessive chargeback” monitoring program where they pay additional fines and fees until they are able to get the chargeback ratio decreased to an acceptable percentage. If a merchant is unable to reduce their chargeback ratio, it may lose processing privileges altogether.

Child Identity Theft

Verify / Fraud
Child identity theft is defined as the theft of a child's personal information, such as their Social Security number.
Source
This information can be used to open bank accounts and credit cards in a child's name, or help someone secure a mortgage, a job, or government and health benefits. Criminals are more likely to capitalize on kids’ data. Among notified breach victims last year, 39 percent of minors became victims of fraud, versus 19 percent of adults, according to Javelin. While adults make prime targets for their account balances, the “blank slate” a child provides can enable a criminal to do more damage by opening new lines of credit before someone catches on.

Civil Records

Data
Civil records are a group of public records that pertain to civil registry records, civil family matters and non criminal civil offenses. These records vary a lot because of the nature of the information that is recorded.
Source
There are various types of public records that are available to the general public. Some of your information that could be considered public record includes: Civil and Vital Records, Birth and Death, Marriage & Divorce Records, Lien and Judgment Records, Criminal Records, Court Records, Government Records, Bankruptcy Records, Driving and Traffic Records, Phone and Address Information, Naturalization and Immigration Records.

Claimant

Investigation
The person making a claim. Use of the word 'claimant' usually denotes that the person has not yet filed a lawsuit. In Insurance also referred to as "the insured."
Source
The Insurance Industry Glossary defines “claimant” as “The party making a claim under an insurance policy. The claimant may be the insured. Under liability policies, the claimant is a third party.” No matter which definition you use, a “claimant” is somebody making a claim – not somebody against whom a claim will be made. Upon filing a lawsuit, the claimant becomes a plaintiff, but the terms are often used interchangeably.

Claims Adjuster

Investigation
A claims adjuster investigates insurance claims by interviewing the claimant and witnesses, consulting police and hospital records, and inspecting property damage to determine the extent of the company's liability. Other claims adjusters who represent policyholders may aid in the preparation of an insurance claim.
Source
Activities typically extend to include the following elements 1) Verify an insurance policy exists for the insured person and/or property. In general, these are written by the policy-holding insurance company. 2) Risk(s) of loss(es), or damages to property, culminating in the loss of property and or bodily injury. 3) After completing the above investigations, evaluate the covered injuries and/or damages that have been determined according to the coverage grants. 4) Negotiate a settlement according to the applicable law(s), and identify coverages for which the insured is covered, following best insurance practices.

Clickjacking

Verify / Fraud
Clickjacking is when a fraudster targets someone to click a link, either to get them to install malware or to try to phish them.
Source
This can be done by sharing baited content on social media, having people click back to the source of the content, where the fraudster then tries to attack them.

Coldline

Investigation
A telephone service used to conceal the identity of the outbound caller's telephone number or Caller ID data.
Source
Services such as "Burnerapp.com" allow users to obtain and manage additional phone numbers for voice, SMS, and MMS communications, Burner lets users get as many numbers as they want to use each as a private line on an iPhone or Android phone, and keep numbers indefinitely or 'burn' numbers they no longer need.

Confirmation Fraud

Verify / Fraud
Confirmation fraud is a type of fraud that comes in two layers. First, a fraudster falsifies transactional information, like pretending to deposit a certain amount of money in an account (on someone else's behalf).
Source
Then, the fraudster creates fake materials that falsely confirm that that first transaction went through, when in reality it didn't. In short, a fake deposit (or other transaction) is falsely confirmed as having gone through by a fake confirmation, so as to cover up the fact that the first transaction was actually fraudulent.

Consumer Authentication

Verify / Fraud
Consumer Authentication is the term used for the devices that are designed to verify that a person making a transaction or any business deal is really the person who is certified to do that action.
Source
This term applies to both card-not-present transactions as well as in-person transactions. Pipl offers uniquely powerful identity data and verification tools so you can confidently approve, deny or escalate transactions. That’s why Pipl is the first choice whenever the world's top ecommerce and financial services companies must confirm that a person is who they claim to be.