BUSINESSES could virtually wipe out the multi-million pound risk of credit card fraud by using a new preventive security system, its Scottish developers claim.
Technology support company Sykes Global Services came up with the system to stamp out fraud for its clients, many of whom manufacture high value goods to be sold online or by telephone through its agents.
Sykes has ten clients on the system an
d estimates it could save £30 million a year.
Phil Lumsden of Edinburgh-based Sykes, who has been the driving force behind the innovation, said that 300 criteria checks a second are now run on each credit card being offered to its agents to eliminate fraud.
He added that more than 20,000 orders are processed through its system each month. Without the new screening between 40-60 per cent of attempted orders would have been fraudulent or rejected. He said: "The financial risk can easily run into the millions of pounds."
Using the Sykes' system, fraudulent use is reduced to about 0.1 per cent of all orders processed. Before launching the system, Sykes ran a trial to check if any bona-fide purchasers had their cards barred. Lumsden said: "When we ran the check, just two complaints came in from a sample of 1,000 orders."
However, Lumsden admitted a genuine order for 20 pairs of sport shoes to be delivered to each member of his team was initially turned down because it appeared suspicious. He said the order was completed on time, once the problem was identified.
