Keeping Fraud at Bay Requires a Joint Effort

Fraudsters are drawn to airlines like a moth to a flame, but they aren’t the ones who get burned.

Air ticket sales are a “prime target” for fraud, said Jose Hernandez, fraud manager at Orbitz Worldwide. “With consumer goods, you can call up UPS and say, ‘Hey, send it back. You can’t do that with flights.”

Hernandez and other panelists at the Airlines Reporting Corp.’s recent TravelConnect conference urged travel agencies and airlines to share information and identify trends.

A joint effort is required to see the patterns, they said.

Fighting fraud also requires constant vigilance. Once an opportunity for fraud is shut down, the bad guys will simply keep poking away at your systems until they find a weak spot.

“They are trying every avenue,” said David Stewart, manager of corporate security at Virgin America.

Callie McKill, Visa’s senior director of global core merchant product, provided examples.

EMV, the new standard for “chip cards,” solves issues with card-present transactions, “but it drives fraud to the card-not-present channel,” she said.

If fraudsters can’t get to your systems directly, they’ll attack your third-party IT providers that have access to them, McKill said.

A new target for fraudsters is the ticket exchange process, Stewart said, so agents need to treat an exchange as a new transaction. “You’ve got to look at every transaction, not just the initial sale,” he said.

McKill advised putting exchanges through a fraud scoring tool, but she cautioned that “no one tool is a silver bullet.”

She also noted that the mobile channel requires a different type of fraud detection system.

Hannah Feldman, senior research analyst at the National Cyber-Forensics & Training Alliance, said plans are under way for another “global day of action” at airports around the world to combat fraud.

“We hope to get more North American airlines involved,” she said.

In last year’s event, more than 265 suspicious transactions were reported; 113 individuals were detained and 70 were arrested.

Feldman noted that credit card fraudsters are often linked to other criminal activities such as human trafficking and drug offenses.