December 9, 2010, 11:14 AM

How 1-800-Flowers cuts back online fraud

The floral e-retailer has slashed the number of attempts at fraudulent purchases.

Lead Photo

Under a new outsourced fraud-prevention program, 1-800-Flowers.com Inc. has cut by 63% the number of cancelled unauthorized purchases on its e-commerce sites.

The e-retailer, after deciding it no longer wanted to dedicate extensive staff to managing online fraud, signed up last year for an outsourcing plan with Accertify Inc., a risk-management technology and services company recently acquired by American Express Co. 

“It allows us to focus on growing our core business and let the experts manage unauthorized transactions for us,” says Barbara Noll, vice president, operational accounting at 1-800-Flowers. “Accertify provides coverage on weekends, holidays and overnights so I don’t have to worry about staffing,” she says. “They ensure our defenses are strong and up to date 365 days a year.”

Operating from facilities in Itasca, IL Accertify provides its Interceptas risk-management platform and a dedicated team of fraud-prevention staff, increased monitoring of online purchase transactions during peak shopping periods, manual review of suspicious orders, and cancellation of unauthorized purchases.

The service also includes ongoing analysis of purchase transaction trends, weekly reports of chargeback data, and updating of such information as payment card account numbers, delivery addresses and other data that can help detect suspicious transactions. Transactions are automatically screened and scored for level of fraud risk, alerting staff as to which transactions require manual review.

The 63% drop in the number of cancelled unauthorized purchases has coincided with drops in unauthorized transactions as well as attempts at unauthorized purchases, the retailer says. The declines in suspicious activity has resulted from the reputation the retailer has gained among criminal elements as an e-commerce site that’s difficult to defraud, the 1-800-Flowers spokeswoman adds.

Accertify, which serves more than a dozen retailers in the Internet Retailer Top 500 Guide, also makes its outsourcing services available to retailers who need to supplement their internal fraud-management operations during the peak holiday season. The company was acquired by American Express last month for $150 million, but retained its entire senior management team and workforce.

Operating as a wholly owned subsidiary of American Express, Accertify plans to further develop its fraud-prevention technology services and expand globally, according to Jeff Liesendahl, co-founder and CEO of Accertify.

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