Whilst fraud was previously focused on accessing payment data to make purchases or withdraw funds, it has evolved to the point where fraudsters now target account data. This is particularly so, due to the growth of ecommerce and the digital journey that merchants and consumers are undertaking. While needing to combat fraud to minimise losses, merchants also need to balance the optimisation of authorisation approvals and sales revenues with the least friction for their customers.

Payments Consulting Network Commercial Director, Jordan Gibbons, caught up with Luke Dynan, Vice President and General Manager APAC at Accertify, to discuss how the company is supporting merchants through the digital journey to minimise fraud while, at the same time, balancing the need to optimise sales.

Luke is responsible for driving the Accertify businesses forward in APAC. Luke has spent the past 20 years leading sales and client teams in the telecommunications, data centre and IT managed services sectors working for some of the largest network and IT infrastructure businesses in Australia. As VP and GM of Accertify based in Sydney, Australia, Luke is responsible for our sales, client management and operational functions across the APAC region.

Read the full interview below.

Jordan Gibbons: Can you please provide a high-level overview of Accertify? For example, a brief history, the services provided and size of the company?

Luke Dynan: We describe ourselves as a leading fraud prevention vendor and have been in the Australian market since about 2012. The origins of Accertify were born out of a travel business in the United States called Orbitz Travel. At a time, there was a noticeable uptick in fraud, particularly for online travel bookings, and from that a solution was designed, which was the catalyst for the formation of Accertify. In 2010, it was acquired by American Express and in May 2024 was sold to Accel-KKR.

The business has approximately 950 staff, with resources operating in nine countries and a strong presence in North America, Europe, and Asia Pacific, including India. We process more than 8 billion transactions annually, with services primarily targeted at enterprises that have a significant digital presence and therefore exposed to a range of risks. We try to follow the digital journey, protecting clients and merchants right across the online buying process, whether it is the creation or management of an online account, an online payment for a product, service or presentation of a chargeback. Accertify provides sophisticated fraud prevention to help merchants better manage and be more successful in the way that they execute this function within their business.

JG: How do you help merchants and clients identify and prevent fraudulent transactions?

LD: The starting point is those first three product pillars looking at distinct aspects of a digital journey. Machine learning is critically important to our business. Most customers will be using our machine learning models, which are often industry based and doing about 80% of the heavy lifting in terms of identifying and stopping fraud. On top of that is a rules engine.

We are still firm believers in the ability for merchants to have a degree of control and configuration over the service. A lot of our clients use us to apply specific rules, whether it be to better manage payment fraud or to look after policy and promotional abuse. The rules engine forms an important part, which merchants use to reduce fraud.

One of the differentiating aspects of our business is that we are data centric. Without quality data you cannot make effective risk decisions in real time. We place a significant emphasis on device intelligence, behavioural data, and use of consortia data, which is all the data that our clients are experiencing day-to-day. These are areas in which we can help merchants better identify fraud, optimise the digital experience and achieve improved acceptance rates as payments are being processed.

JG: In terms of your key strengths, those are machine learning capability, data, and the rules engine, would that be a fair summary?

LD: Yes. There is also a layer on top of that which is all around Accertify’s expertise. A notable part of our business is merchant outsourcing and the management of their fraud solutions, whereby we take the responsibility to both develop and execute their fraud strategy. We have built up a significant amount of internal expertise and understand fraud intimately.

That service layer we apply is about understanding what our merchants are trying to do. Fraud is evolving so much and so rapidly; therefore, it is about how we leverage what we see happening today and how we can share that with our clients.

JG: It really is an arms race, isn’t it, with fraudsters?

LD: Fraudsters are innovative. The moment you have closed one attack channel; they will identify another one. It is beholden on vendors like us to be constantly on the edge of knowing what is happening with fraud so that our services can continue to adapt to those evolving threats.

JG: What fraud trends do you see over the next two or three years and what sort of impact do you see those having on your business and that of your clients?

LD: We’ve seen fraud evolve massively with significant attacks at the account level. We are a strong believer that merchants can avoid the payment fraud outcome if they are able to apply effective risk decisions on the digital journey before any sort of payment. The ability to identify if there is a fraudulent account or if an account has been taken over is increasingly important in terms of that end-to-end solution. If you can identify suspicious behaviours at the account level, e.g. when they are shopping, accessing their account, changing a credit card, or when they are logging on or off, you have a better chance of being able to stop the actual payment fraud. These are referred to as non-payment digital events, which gives us strong indicators as to whether this is a legitimate transaction or event. We will continue to focus substantially on the account side. We also see fraud evolving into first party misuse, a lot of policy abuse, and promotional abuse.

Recently, we released a returns and refunds solution which is heavily focused on the retail community. It is using that same transaction data but processing in a different way, for example, to identify whether a customer might be abusing the returns policy. That is an area retailers are struggling with because they do not have the data and are unable to match it against the transactions going through their system. We feel we are well positioned to be able to help retailers identify specific users that may be abusing those types of policies.

On the other hand, looking at it from the perspective of chargeback and disputes, the ability to obtain data from issuers and acquirers and be able to better help merchants go back to their acquirers and let them know this was not a fraud chargeback but first party misuse is critical. Once again, it is about using the data that can help merchants be more successful. The value proposition to our clients is not only about reducing fraud but balancing that with maximising conversion rates and sales.

JG: Aside from retailers, are there specific sectors you focus on, or do you work broadly across any industry?

LD: We focus on airlines and travel, retail, ticketing, gaming and financial services. They are probably the principal areas where our merchants are exposed to a digital transaction or a digital means of engaging with their clients. We are very successful in airline travel because that was the origin of our business, but certainly since then, we have a significant leading market share in retail. Organisations that are largely focused on providing services or transactions online, that have a strong digital presence, are a target client of ours.

JG: In terms of the trends and the multitude of regulations in the different markets that you service, how do you keep up to date with all the changes and emerging regulations from the Schemes or regulators?

LD: There are several ways that we look at that. Accertify have product experts. For example, our chargebacks area, which relies heavily on scheme rules, ensures we can adapt our service to help merchants be more successful in how they defend chargebacks. Compelling evidence 3.0, is a great example of that. We have adapted our platform in such a way that it can accommodate larger data, documents and payloads that can be distributed back up in the system. We rely heavily on the Scheme rules to help shape our service.

We operate in many different markets and have a number of people in Europe that are specialists in European regulations, for example PSD2/SCA. It is about us evolving, adapting our services so they specifically meet regional requirements, but also keeping the customer experience at the forefront of our solutions. This means looking for opportunities to remove unnecessary friction, without increasing the risk for our clients. We have similar challenges across Asia Pacific, for example, impending regulation in Japan around the use of 3D secure or the fraud mitigation framework in Australia.

We also connect with our community throughout the year, whether it be regional or global summits to share information. This can include what trends they are seeing, their observations, and how they are approaching some of these challenges.

JG: One of the payments trends is an increasing volume of real time payments and account to account payments. How do you see that affecting your business and how you might deal with that given you do not have the same sort of chargeback capability? For instance, that you do with a credit card or a scheme debit.

LD: Accertify are still seeing a card centric business today. Having said that, we have a lot of retailers, for example here in Australia, where 50% of their transactions are made on credit card. There is 50% through alternative payment methods. We are starting to see changes to the payment mix for our merchants. It is still early days, but I think there is probably going to be a drive towards that in future. If we get data, we can still assess for risk for account payments or real time payments moving forward. If there is a data flow, and a range of data fields to accompany the actual transaction, we can assess whether this is real or otherwise.

JG: In terms of your product strategy, is there anything you can share about that over the next couple of years? For example, changes to the product, improvements, new products?

LD: Accertify continue to see threats right across the digital journey. We recently launched a returns and refunds capability, particularly to our retail segment, because many do not have the means to effectively manage that. It is using that same online transaction data that we are processing for these merchants, thereby making better use out of that. We continue to invest in machine learning, which is essential to our future success, so that we can progressively remove complexity, time, and resources for merchants in the way that they manage their services, without taking away the ability to configure it, which is critical.

The more we can automate, the better, but not at the cost of accuracy or efficiency, which is where our merchants will continue to benefit. Automation for us is a major focus over the course of the next two to three years with machine learning and AI at the centre. But it is also how we invest in our infrastructure. A good example recently is Accertify investing in the ability to process thousands of transactions per second. For certain merchants that have high demand, (a demand that lasts for two minutes), but if you cannot handle the increase at that precise moment, the merchant once again is exposed to considerable risk.

During Black Friday, Cyber Monday, we will process tens of millions of transactions in each of those days. But certainly, several of our brands around the world now have spikes, with promotional and sales campaigns that lead to a huge amount of demand in short periods of time on our network. Our network needs to scale, hence the significant round of investment in the infrastructure allowing us to successfully deploy services that allow merchants to have incredible spikes. And this might only happen two or three times a year, but you have still been able to handle it because they process a significant volume of transactions, and that is central to their business model.

JG: What do you see as your key achievements over the last sort of 12 months or so?

LD: We always look at our achievements through the eyes of our customers via leading indicators, e.g. how much fraud have we stopped? What is our average acceptance rate? We come back to the fact that it is not about just helping the bottom line through reducing fraud, but also customers’ maximising revenue. We are averaging greater than 98% acceptance rate of transactions globally, the vast majority in a frictionless way.

Accertify are processing hundreds of millions of non-payment digital events for a growing volume of merchants globally, helping them stop what would otherwise be a fraudulent transaction somewhere in the payments journey. The benefits are manifested not just in a reduction in payment fraud but in reducing negative brand exposure.

JG: Are there any markets, geographical or sectoral, seen as riskier than others?

LD: Regulation around the world is quite varied and that results in some degree of complexity. Japan has followed a substantial uptick in ecommerce over the past five or six years. That has led to a response by regulatory authorities and others in that space to begin deploying preventative measures. But those offered by the banking system, such as 3D Secure, have seen a significant backlash in that market because they are not considered to be truly effective.

Asia is fragmented in terms of regulation and the adoption of ecommerce and different payment instruments. You look across Southeast Asia alone, and there are 200 or 300 digital wallets. Australia is traditionally a card centric area, and we see that as presenting complexity but also as an opportunity.

In EMEA over the past three or four years, we have seen this with PSD2 and SCA and have had to evolve our products specifically to address local regulation requirements.

In general, we see 3rd party fraud in travel and more 1st party abuse in online gaming with promotional abuse. From a market perspective, gift cards universally have a higher risk profile. Geographically, there has been a spike in 3rd party fraud using Japanese cards, which has resulted in an introduction of 3D Secure, but this is not considered to be truly effective.

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Accertify is a member of our Fraud and Chargeback Management Panel.

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Author: Jordan Gibbons, Commercial Director, Payments Consulting Network

Jordan has over 30 years commercial experience traversing law, financial services, payments and consulting. He has a strong track record in driving profitable business outcomes through a focus on practical business strategy, strong financial analysis and understanding of market conditions and trends. He is an innovative thinker prepared to challenge the status quo. He has served on industry bodies/working groups and boards including being Chair of ATM Access Australia Ltd.

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