Online Fraud Threatens Viability of E-commerce

Michael Vizard

When it comes to productivity, IT technologies cut both ways. Obviously, IT makes employees and consumers more productive. But it can just as easily be used by malevolent people to perpetrate digital crimes.

For the most part, it's been left up to financial institutions and online merchants to combat this issue. But TrustDefender CEO Ted Egan says that as it now becomes easier to spot online fraud before it happens, don't be surprised to see Internet service providers playing a more active role in online fraud detection than they have in the past.

TrustDefender provides security and fraud risk management software. The company this week launched TrustDefender Zero, a tool that detects whether a user's personal details have been stolen and what specific threats are targeting the device they are using, and TrustDefender Central Intelligence Server, which keeps track of all the threats and provides the intelligence to determine whether a device has been potentially compromised.


While the primary customers for these offerings are anyone that has anything to do with online transactions, Egan says that in his native Australia, ISPs are starting to play a much larger role when it comes to online fraud. With billions of dollars at stake, it is obvious why financial organizations are looking to clean the "Wild West" atmosphere that still permeates the Internet today.

But like most criminal activity, online fraud flourishes because it's relatively easy to accomplish even as the number of actual complaints about online fraud declined 10 percent last year. But with the proliferation of mobile e-commerce applications on the Web, online fraud is likely to get a whole lot worse unless ISPs find a way to become more proactive about combating it.

There's nothing short of the future of e-commerce at stake here. If the Internet is not a safe place to conduct business, people will stop using it for that purpose. Right now, the financial gains for financial institutions and online merchants outweigh the potential risks. But without some sort of collective effort to combat online fraud, chances are the risks could outweigh the benefits sooner than most of us really want to admit.

Add Comment      Leave a comment on this blog post
Dec 5, 2011 10:39 AM Malinda Hartwig Malinda Hartwig  says:

Indeed, digital crimes seem to be increasing. That's what makes internet so unsafe. Online trading is getting more and more risky. Fraud is a real threat and it's too bad that at the moment we can't do anything to avoid its expansion. Well, things happen!


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