Transaction Defender puts Kaspersky back in control of fraud rates

Company
Kaspersky_svg
Markets
Security Software
The Customer

Kaspersky Lab is one of the fastest growing IT security companies worldwide and one of the top four leading vendors of endpoint security software.

The Challenge

During the summer of 2009, Kaspersky launched multiple online stores in Europe and the US, but soon noticed a critical fraud problem: chargeback and product loss rates were surging to unacceptable levels.

The Solution

Digital River took a two-step approach to deal with the fraud problem: risk identification for immediate relief and the implementation of Digital River’s fraud prevention solution, Transaction Defender, for long-term results.

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Fraud attack rates down from up to 28% to below 5%

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Better long-term control and stability

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Secure fraud detection offers peace of mind

The Story

Headquartered in Moscow, Russia, Kaspersky brings their endpoint security software to more than 100 countries around the world. Since 2000, Kaspersky has relied on Digital River to manage their global ecommerce operation. This includes providing marketing services, website development, transaction processing, tax management, product fulfillment and risk management services.

When Kaspersky launched their online stores in Europe and the US, they discovered that their existing fraud solution lacked the technical capabilities required to handle the sophisticated fraud attacks global expansion exposed them to. They were not able to block fraud without also increasing their customer insult rate.

When Kaspersky partnered with Digital River to find a solution, they started with short-term fixes to limit fraudulent activity and product loss, and restore chargeback and risk levels to historical norms. They did this by implementing manual order reviews, removing susceptible payment methods, removing or limiting access to a validation site for product codes on the Kaspersky site, and adding proxy piercing data collection to identify suspected fraud.

Another critical step involved creating a “key deactivation” program. Often, fraudsters will buy Kaspersky products using stolen credit cards. The fraudsters then turn around and sell that software on their own sites, often with a discounted price. Key deactivation stops these attacks by remotely removing the digital entitlement rights from the fraudulently obtained software.

As a more long-term solution, they implemented Digital River’s Transaction Defender on all Kaspersky sites. With this system in place, they were able to eliminate many of the short-term fixes while maintaining the lower chargeback and fraud attack rates.

The initial risk reduction tactics resulted in an immediate and dramatic reduction in fraud attacks. With the addition of Transaction Defender, they were able to further stabilize a high variability in fraud rates. By taking a holistic approach to fraud with enhanced business processes, a key deactivation program and Transaction Defender technology, Kaspersky now has a well-controlled and very successful fraud prevention process.