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Stopping Fraud by Blacklisting PCs

A company called Iovation has created a service that identifies computers that have been used to make purchases with stolen credit cards and then add them to a blacklist. Doing so prevents a user from using the same computer for more then one fraudulent transaction. They can constantly change their username or IP address but as long as they use the same computer they won’t be able to get back into a Iovation-protected site.

Because Iovation shares its blacklist with all of its merchants as its list grows every merchant benefits. Currently online poker sites have been taking advantage of the service and Iovation plans to expand into gaming as well.

The technology works by using two methods to identify a fraudulent computer. The first step is when a user opens an account on a website that uses Iovations service a small bit of code is installed on the user’s computer. The company then monitors their patterns of behavior. If the user engages in suspicious activity, such as having dozens or hundreds of accounts from a single website, the code installed onto their computer becomes a black mark.

The only way for a malicious user to overcome this is to buy new hardware. Which, although very possible, can also become expensive and tedious.

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