Patent ID: 7865427
Filing Date: 2011-01-04
Classification: G06Q,G07F

Abstract:
1. A method for evaluating fraud risk in an electronic commerce transaction and providing a representation of the fraud risk to a merchant using electronic communication, the method comprising: generating and storing two or more fraud risk mathematical models, each model having a corresponding distribution of fraudulent transactions and a corresponding distribution of non-fraudulent transactions; generating for each mathematical model of the two or more mathematical models, a pair of corresponding sigmoidal functions, wherein one sigmoidal function of the pair of corresponding sigmoidal functions approximates a relationship between a set of raw scores produced by said each mathematical model and a percentage of fraudulent transactions associated with each raw score of the set of raw scores, and another sigmoidal function of the pair of corresponding sigmoidal functions approximates a relationship between said each raw score and a percentage of non-fraudlent transactions associated with said each raw score; defining for each mathematical model a first point at which a number of transactions that represent mistaken sales begin to have a positive count; a second point at which a number of transactions that represent mistaken rejections begin to have a zero count; and a third point at which the fraudulent and non-fraudulent transaction distributions for said each mathematical model intersect, wherein the third point corresponds to a particular raw score for which a percentage of fraudulent transactions equals a percentage of non-fraudulent transactions; receiving transaction information and performing: wherein the method is performed by a computer system.