Catching a Crook by The (Silver) Tail

The slickest crooks succeed in their scams by blending in, getting "lost" in the crowd of legitimate players who surround them.

For Silver Tail Systems, the trick to sussing potential fraudsters is to track how the crowd acts and see what doesn't fit. This concept of applying what the company's founder and vp of product marketing Laura Mather calls "crowd sourcing" to fraud identification and mitigation is what sets Silver Tail apart.

"Other fraud prevention tools look very deep," Mather explains, adding that these technologies are designed to look at the geo-location, IP address, and other identifying information for the individual user.

"Silver Tail doesn't look at particular users as closely, we go broad rather than deep...we look at the activities of the crowd and look for deviations," she says, adding that Silver Tail's tools can work in tandem with legacy tools to offer banks the best insights on where and when fraud might occur.

According to Mather, a former director of fraud prevention for eBay, the Palo Alto-based company's fraud forensics and mitigation tools perform three functions: analyze behavior across a Web site to see what doesn't fit usual patterns; provide for efficient investigations of suspicious exploits, so banks don't have to waste time combing through Web logs; and help IT teams mitigate future fraud attacks by making it easier for engineers to add barriers that make it more difficult for crooks to perpetrate a similar exploit. Silver Tail's mitigation tools allow a business owner to spot an attack in progress and "change the page flows of the Website to prevent malicious behavior without impacting legitimate users. Action is taken in real-time to stop bad behavior in its tracks."

As Mather points out, given enough time and resources, bad guys will eventually find ways to circumvent just about any barriers that financial institutions throw up - the real goal is to make it more difficult and less profitable for would-be thieves to commit crime at their customers' banks. "It's like running away from a bear," Mather says. "You don't have to be faster than the bear, just faster than the other hikers that are running away."

Jim Bruene, the founder and CEO of Online Financial Innovations in Seattle, says Silver Tail Systems has impressed the banking industry with their novel approach to the fraud issue. Presenting at his firm's Finovate conference this spring, Silver Tail made a big splash with the audience and was voted best presenter in the show. [Silver Tail was also previously cited as one of the 10 Tech Companies to Watch by Bank Technology News.]

"It's hard to really visualize security," Bruene says. "They do a great job of letting [people] see how it works."

Mather says Silver Tail's tools are currently installed a large undisclosed e-commerce company that gets 160,000 clicks per second, and Silver Tail is also in discussions with more than 10 banks.

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