Start-ups Forter, BillGuard and Onfido Seek to Help eCommerce Fraud Detection

Forter, a start-up that uses a complex algorithm to help e-commerce sites detect fraud, has raised $32 million. The Israeli firm, which was founded 3 years ago by former employees of the country's intelligence agency, is trying to tackle the rising problem of online card fraud in a world where it's easy to buy stolen financial details online. Forter's software takes into account thousands of data points and analyzes user's behaviour as soon as they log on to an e-commerce site. It works using a combination of so-called machine learning and human know-how to recognize fraudulent trends. But because it is automated, the retailer doesn't have to do anything manually. "Every merchant needed to develop their own fraud prevention. They would review their own transactions manually. After all of that, retailers are losing billions of dollars," Michael Reitblat, chief executive of Forter. Reitblat said the software could make a decision in less than half a second. And the idea is that the algorithm gets smarter the more it is used. The start-up claims to have generated 5 to 10 percent of sales increases last year for retailers using the Forter software.  Online fraud detection has emerged as a key tool for companies operating online, and it’s not just about point of sale. Last year, P2P lending platform Prosper Marketplace acquired BillGuard, a finance-tracking firm, to bolster its security credentials. Last week, identity verification startup Onfido raised another $25m to help businesses carry out background checks on individuals. Can Forter and its competitors achieve their mission of helping e-commerce firms detect fraud? Send your predictions to the Cloud and Cyber Security Center: http://cloudandcybersecurity.blogspot.com/