Are High-Security Checks Worth It?

by Gergo Varga
Account takeovers – or account hacking, as your customers may call it – are terrible for your brand reputation. Each successful attack can cost the business up to $12,000 and will also tarnish your reputation with customers.
This is why, when an ATO happens, time is of the essence. A responsive, effective and robust alerting system is crucial.
Let’s see what an account takeover alert should look like and how you can start deploying them today.
An account takeover alert is a system designed to notify a company or user(s) that a suspicious login which might indicate an account takeover attack has taken place. It may be triggered based on a number of parameters, such as a login from a new device or IP address, as well as combinations of these parameters.
The most sophisticated account takeover alerts can look at user behavior to identify suspicious actions. For instance, a large number of withdrawals or a password reset could be considered high risk.
As for the alerting system, you may be able to deploy an internal solution or leverage a third-party tool, usually in the form of fraud prevention software.
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The short answer is all of them. Any business that offers user accounts should be proactive about protecting them against takeovers, to minimize fraud, protect its revenue and safeguard its reputation. However, fraudsters tend to target these more often:
Account takeover alerts can be a powerful security tool. They can also be a serious hindrance to good business.
The biggest advantage of creating an alerting system, both for your business and your customers, is that you’ll be able to catch any suspicious activity before an account is compromised.
This will block fraudulent activity at the source, which can have a positive impact in a variety of ways, from reducing chargebacks to better data safeguarding or even maintaining a good relationship with your customers.
The downside, however, is that alerts can be hard to calibrate. It requires trial and error, as you want the rules to be effective but not too strict.
If you are too careful and ask customers to confirm their ownership of the account every time they use a new device or IP address, for instance, you’ll be asking for trouble. Too much friction is frustrating and may cause your customers to look for less stringent alternatives – also known as customer churn.
Aside from the false positives, it’s also worth considering the manual efforts required to tweak your fraud detection rules and to restore login privileges to the right customer – which may translate into extra resources for the customer service department.
Your account takeover alerts should be tailored to your risk challenges. You should hopefully have a good understanding of what a good login looks like and know how to recognize a suspicious one.
Broadly speaking, there are two types of alerting systems:
Below are examples of what SEON has identified as potentially risky user behavior after a fresh login, with examples from both kinds of alerting systems.
Examples worth highlighting include:
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SEON is designed to give you as much information about your customers as possible, whether they are signing up for the first time, making a payment, or logging into their accounts. You can deploy custom risk rules, industry-specific presets and even machine learning suggestions to automatically flag and block suspicious activity.
This allows you to protect your customers’ accounts when someone else wants to log in, but also to ensure you don’t accidentally add friction for legitimate users, causing frustration and churn.
On top of being able to automatically create alerts, you can even integrate SEON with other tools via Zapier. Set up custom alert systems that ping you directly on Slack or Gmail, and stay on top of all your login security however you see fit.
An account login may be deemed fraudulent if data or user behavior appears suspicious or even inconsistent with the user’s previously observed behavior. Companies will set up alerts designed to instantly flag or review these suspicious logins in order to protect their customers’ accounts.
An account takeover will usually result in changed account details, such as an email address, phone number or bank account information. This is what a fraudster will attempt to do as soon as they manage to gain access to a consumer’s account. Other signs to watch out for may include an unusual, inconsistent IP address or device configuration.
An account takeover happens when someone illegally logs into your account. It does not necessarily involve stealing your identity. However, if your account contains personal information (PII), the fraudster may use the account as a starting point to steal your ID – which is also known as identity theft.
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Gergo Varga is SEON’s Product Evangelist. With more than 10+ years of experience in the Hungarian and international risk management sphere, he has developed an astute knowledge of RiskOps and Open Source Intelligence. He is the author of SEON’s Fraud Prevention for Dummies guide.
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