MAPP Advisors attended the MAC West Regional Meeting held on Thursday, September 7, 2017 at the United States Secret Service building in Los Angeles. Here are highlights from the meeting:
David Landis, VP, G2 and Board Member/VP of MAC’s Western Region kicked off the meeting with opening remarks and was a gracious host to attendees and speakers.
Stoddard Lambertson, Director, Fraud & Breach Investigations, Visa USA discussed the paradigm shift that EMV has caused in fraud management. He went on to state that most major attacks on financial institutions happen on week-ends and holidays when financial institutions tend to have a skeleton staff on hand. He discussed the importance of having a plan in place to properly staff and monitor fraud during week-ends and holidays.
Domenic Cirone, VP Chargeback Processing, EVO Payments International discussed the importance of chargeback and risk departments working together. He discussed the Visa dispute processing changes being implemented in New Zealand and Hong Kong in October 2017 and all other countries including the United States in April 2018. Visa will replace the terms chargeback with dispute and representment with dispute response. They will also shorten the timeframe for resolution. Mastercard is reducing their resolution timeframe in late 2017 or early 2018 as well.
Sid Pershad, Sr. Director Risk Management, PayPal recommends leveraging insights from unique data sources to manage portfolio risk. PayPal manages seller risk through close monitoring and mitigation methods. Monitoring includes volume growth, chargeback rates and social media appearance, and mitigation includes delayed settlement and letters of credit.
John Brady, VP, Customer Compliance & Fraud, MasterCard talked about emerging threats and fraud trends. He highlighted Synthetic ID Fraud which occurs when a fraudster combines real and fake information to create a new identity which is used to open fraudulent accounts and make fraudulent purchases. This usually occurs with stolen social security numbers combined with fake names and addresses. It is estimated that 80% of social security numbers used in synthetic ID fraud belong to children and that many don’t realize they are victims of fraud until they apply for college. The prevalence of synthetic ID fraud is a wake-up call to the industry.
Brian Busony, US Secret Service Field Agent, United States Secret Service focused on the importance of partnerships in the Secret Service’s efforts to thwart Cyber, Electronic and Financial Crimes. He also discussed the roles of their Electronic Crimes Task Force (ECTF) and Financial Crimes Task Force (FCTF). The task forces partner with the private sector, academia, and local, state and federal law enforcement to combat electronic and financial crimes.
Edward Marshall & Theresa Kananen, Partners, Arnall, Golden Gregory LLP covered litigation trends impacting processors and ISOs. They discussed large cases pertaining to FTC/CFPB, EMV and Merchant Class Action Challenges.
Mark Standfield, President, Mitigator discussed chargeback resolution. He highlighted pre sale risk management via fraud filters such as CVV, AVS and CAPTCHA; and post sale risk management such as billing model issues and recognizable billing descriptor. Chargebacks are on the rise. He stated that 60% of customers that file a chargeback do not try and contact the merchant first and that 40% of consumers who file a fraudulent chargeback will file another one within 60 days. To combat these trends, merchants can start negative databases to keep track of consumers who file them and use merchant CRM and billing systems to provide keys to cut down on chargebacks.
The meeting concluded with a Member Round Table to discuss the topics covered at MAC’s West Regional Meeting. The meeting was very informative and well attended. MAPP Advisors looks forward to participating in next year’s meeting.