IT Fights Fraud

Fraud at a travel information and review website? You bet. TripAdvisor has seen a spate of fake travel reviews from companies and hotels to boost their own reputations or besmirch those of competitors as well as so-called” black hat search optimization” techniques to boost their ranking on the site. Gaming the system hurts consumers and damages the reputation of the site, potentially blemishing its value. Last year the U.K. Advertising Standards Authority made it drop the slogan “reviews you can trust” because thousands of hotels complained that they were being hurt by fake reviews.

What’s a company to do? Adopt some anti-fraud techniques from the financial services industry. Techniques, algorithms, and technology originally developed to spot credit card fraud as it was happening. By undertaking a statistical analysis of dozens of aspects of a review, it can spot questionable reviews and pull them from the site.

A classic complaint of business executives is that it can be difficult to understand the value of investment in computers. They may not automatically respect a B.S. in information technology but show management a way to improve operations, save money, and protect value and you will get attention.

Fraud can be a problem for any company. Many years ago, experts first started to apply extensive data monitoring and complex real-time statistical analysis to identify credit card fraud. For example, someone might be placing an order using a credit card associated with one address but asking the goods to ship to another location. Maybe the order is placed from a mobile device connected to a Wi-Fi network located someplace the customer has never apparently been before. Add the factors and the company can see potential fraud in the making.

Although many techniques have been known for a long time, IT organizations are starting to realize that they can expand where they use them. TripAdvisor is hardly the only company that wants users to review products or services but avoid potential fraudulent entries. Consumer review site Yelp blocks 20 percent of its reviews from ever appearing on the site. Some legitimate reviews may get misidentified in the process, but that is a risk the company is willing to take to police posts. No wonder as market analyst Gartner has estimated that fake reviews would make up between 10 percent and 15 percent of all reviews by 2014 and that some Fortune 500 companies could face litigation from the Federal Trade Commission.

The online world is full of activities that could lend themselves to fraud, whether by consumers or companies. Social networks are similar to review posts in that people can anonymously attack the reputations of businesses, and commerce is increasingly tied to that set of technologies.

As new capabilities come to the world, unscrupulous people will find ways to exploit them to their own ends. Smart IT professionals will be on the vanguard of protecting the company, and proving their own worth to the organization.

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