Forter Tops Gartner Cool Vendor List For Innovation In Fraud

It’s no secret that, as fraudsters continue to evolve and increase the sophistication of their tactics, the­ fraud prevention landscape must do the same in order to stay one step ahead.

In an effort to show some recognition to the “good guys” out there and the innovative efforts being made to disrupt their respective marketplaces, Gartner has identified the recipients of this year’s “Cool Vendor” recognitions.

As part of the announcement that Forter was recognized as a Cool Vendor in UEBA (user and entity behavior analytics), fraud detection and user authentication for 2016, Bill Zielke, Forter’s CMO, sat down with PYMNTS to discuss what the recognition means for the company.

“It’s really a symbol that the market, as well as the technology that exists in the market, is beginning a transformation,” Zielke explained.

This “new era of fraud prevention,” as Zielke described it, involves the evolution of fraud decisions from a sometimes manual process to a completely automated experience — removing the need of the manually reviewed rules and scores that merchants may turn to when it comes to giving a “yes” or “no” to a transaction.

With fraud prevention being a complex, time-consuming and very expensive endeavor, Zielke said the market is now beginning to recognize the need for disruptive technologies, such as Forter’s automated, real-time Decision-as-a-Service solution for online merchants, to gain traction.

Though the dominant market approach uses a rules-based engine to score individual transactions and then produces a score associated with the level of risk, these systems still require manual reviews when scores land somewhere closer to the middle of the road, versus being either high risk or low risk.

This is where Zielke says rules-based systems fall short.

Not only can manual reviews result in a merchant unknowingly turning away good business through false declines, but they also introduce unnecessary friction for legitimate buyers.

With global fraud attacks on the rise, Forter is looking to transform the need for retailers to manage these rules-based systems that produce scores.

“From a model standpoint, this idea of fighting fraud on a cloud-based, centralized or network-based type of an approach makes a lot of sense versus individual retailers trying to do it themselves and go at it alone,” Zielke pointed out, noting that this new model drives the potential for incremental sales and increased accuracy.

With a completely automated system and a 100 percent chargeback guarantee, Forter is looking to give merchants an escape from the liability that’s associated with mistakenly approving a fraudulent transaction.

Now that Forter has the “Cool Vendor” title, the focus is on remaining cool and innovative in a rapidly changing space.

Zielke noted that it’s paramount for Forter to continue innovating its Decision-as-a-Service solution and service, which includes supporting the variety of new payment types and ensuring support of all payment channels, like mobile and call center, in addition to Web. Zielke said the focus is not only to innovate those channels but to also cover the liability that comes from processing numerous transactions across its rails.

Last month, Forter secured a $32 million Series C funding round and plans to use the new capital to help fuel the buildout of its technologies through R&D initiatives, as well as supporting expanded sales and marketing functions in the U.S.

Fraudsters today are refusing to stand still, and with that, they continue to excel in the business of defrauding retailers.

“Because we take ownership, we remove that liability and that worry from the retailer, and as a result, they can focus on growing the business, as opposed to the fraud prevention function,’’ Zielke explained.

“As fraud gets more and more sophisticated, it’s really an opportunity for merchants to focus on their core business, as opposed to the cost-intensive and quite complex nature of trying to keep up with fraudsters.”

Zielke said that Forter being recognized as one of this year’s Cool Vendors by an iconic institution within technology really means that Gartner is not only recognizing the trend and disruption in fraud prevention but also the significance of sharing that information across the industry.