What are the velocity rules supported in FraudLabs Pro?


What does velocity mean in FraudLabs Pro system? To put it simply, it means the changes of an element value with respect to a context within a given timeframe. For example, the changes of amount (element) in a profile (context) within 24 hours (timeframe). Monitoring the velocity is not only useful but important to merchant as exceeding a pre-set threshold usually indicates unusual behaviour. Hence, we have introduced the velocity rules to help the merchants to monitor these changes effortlessly.

FraudLabs Pro supports a variety of velocity rules, as shown in the table below. In general, you can create velocity rules to monitor the changes of order amounts, order quantities, and number of attempts (or transactions). Detailed explanation for each element are listed below.

Element Context Timeframe
Amount In single transaction
In a profile Within 24 hours / 7 days
Quantity In single transaction
In single transaction Within 24 hours / 7 days
Transaction By credit card Within 24 hours / 7 days
By email address Within 24 hours / 7 days
By IP address Within 24 hours / 7 days
In a profile Within 24 hours / 7 days

Amount Velocity Rule

You can use an amount velocity rule to notify you whenever a big amount is transacted in a single order. When this happens, there are 2 possible scenarios. First scenario is that a legitimate user is trying to buy a big ticket item, and as should be the case, you may want to review the order or make a courtesy call to confirm the order if necessary. The alternative scenario is that a scammer is trying to defraud you. A follow up phone call is a must to authenticate the buyer in this case.

In addition, you can also validate the total amount transacted in a profile (license) as a whole within a timeframe by using the amount in-a-profile velocity rule. For example, from the sales history, you have determined that you will average about $1,000 in sales per week, and therefore any abnormal spike beyond that average amount, say $5,000, shall be notified for a more thorough review.
Amount Velocity Rule

Quantity Velocity Rule

The function of the quantity velocity rule is similar to the amount velocity rule, except instead of checking the amount, this will check the quantity in the orders against the pre-set threshold.
Quantity Velocity Rule

Transaction Velocity Rule

The transaction velocity rule validates the total transactions performed. FraudLabs Pro supports 4 different types of transaction velocity rules, such as by-credit-card, by-email-address, by-ip-address and in-a-profile.

The rules of by-credit-card, by-email-address and by-ip-address are self explanatory. E.g. for by-email-address, it checks the total transactions with respect to the visitor’s email address whether it is exceeding the pre-set threshold. If the result is yes, then it will trigger the selected action, e.g. mark order by manual review. The same goes for by-credit-card and by-ip-address rules, that it will check against the credit card and IP address respectively.
Transaction Velocity Rule by Email address

For the in-a-profile rule, it checks the total transactions that occurred in a profile (license) as a whole within a timeframe. Please do not confuse with the transaction velocity rule vs quantity velocity rule. The transaction velocity rule validates the number of orders transacted, however the quantity velocity rule checks the total quantity in the transacted orders for validation. For example, suppose you received 3 orders, with order #1 contains 3 items, order #2 and #3 contain 2 items. In transaction velocity rule, the system will use 3 as the value for validation, as you have only 3 incoming orders. However, in quantity velocity rule, it will take the value of 7 by summing up the quantities in all 3 orders.
Transaction Velocity Rule in a Profile

Summary

In summary, velocity rule(s) have been widely used by our clients to alert them to any abnormal spikes in transactions. This has not only helped them to reduce their time and effort to manually monitor the changes, but also reduced the fraud losses by reacting to the issues promptly.

 

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