4 BEST PRACTICES FOR PREVENTING AIRLINE FRAUD. Accertify All rights reserved.

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1 4 BEST PRACTICES FOR PREVENTING AIRLINE FRAUD

2 Airline fraud is becoming more rampant and sophisticated. Fraudsters are able to quickly identify and exploit an airline s vulnerabilities. As gaps are filled, they quickly change tactics and move to the next area of exposure and opportunity. Mark Michelon Vice President of Global Client Services Accertify

3 COMMON TACTICS INCLUDE

4 TRANSACTIONAL FRAUD Stolen credit cards are frequently used to purchase flights In many cases, these itineraries are booked at the last minute or booked well in advance and then exchanged for a more immediate departure to avoid scrutiny.

5 ard Mile ACCOUNT TAKEOVER.com Many fraudsters hack into loyalty and mileage plan accounts to access accrued miles. Once they are in an account, they can use the miles for flights and marketplace purchases or transfer them to a different account to avoid detection.

6 LOYALTY PROGRAM FRAUD Loyalty and mileage plan accounts are often established by fraudsters to make fraudulent transactions look more legitimate. In many cases, stolen credit cards are utilized to purchase miles, which are then used or resold.

7 REWARDS ABUSE Some fraudsters purchase high-priced tickets to attain points from their credit card company, and then cancel the ticket after those points have been used or sold. This creates unnecessary churn, taking up valuable seats and resulting in lost revenue.

8 COUNTERFEIT CARD FRAUD With airline websites and call centers becoming more sophisticated and secure, many fraudsters are going straight to the ticket counter to book flights with a fake credit card. Because most ticket counters have yet to implement EMV/chip technology, they don t have the ability to quickly detect counterfeit cards and transactions.

9 HERE S HOW YOU CAN IDENTIFY AND HELP PREVENT THESE FRAUDULENT ACTIVITIES

10 1 COMBINE AND ANALYZE DATA FROM ALL CUSTOMER CHANNELS

11 THIS MEANS... Combining all transactional data into a single system and analysis model including direct sales through the web, call center, and ticket counter as well as indirect sales via affiliates and travel agencies. Ticket exchanges, upgrades, frequent flyer miles, loyalty points, gift cards, and marketplace purchases should also be tracked and analyzed.

12 2 LEVERAGE EXTERNAL DATA

13 THIS MEANS... Supplementing and enhancing internal data sources, providing a more comprehensive view of individuals and the legitimacy of their transactions. Analyzing IP addresses, credit card data, and addresses can greatly improve your understanding of who is doing what and from where they are doing it.

14 3 DEVELOP AN AUTOMATED, SCALABLE FRAUD PREVENTION STRATEGY

15 THIS MEANS... Implementing a holistic strategy often with support from fraud prevention experts that can scale with spikes of activity and adapt to fraudsters changing tactics. Automation and machine learning are essential, helping scour volumes of realtime transactional data, weeding out valid activities, and flagging potentially fraudulent behavior without human intervention.

16 4 LEVERAGE COMMUNITY DATA

17 THIS MEANS... Airline fraud is an industry-wide problem that can be confronted collectively. The more airlines can pool fraud-related data about illicit individuals, credit cards, addresses, IP addresses, and tactics the better they can protect themselves. Machine learning can be applied to data pooled from multiple carriers to maximize insights and develop best practices.

18 KEY TAKEAWAYS These best practices cannot be limited to a single department or engagement channel. They must be tackled holistically across all customer touchpoints. Accertify has a wealth of experience in the airline industry and can help with everything from strategy and process development to data acquisition and analysis. Accertify applies machine learning to data pooled from multiple carriers to obtain the latest insights and best practices.

19 LEARN MORE To learn more about Accertify s Airline Machine Learning Model, visit www.