American Express Co. is spearheading a coalition that aims to help Web merchants combat online fraud, the card company announced this week.

The Worldwide E-Commerce Fraud Prevention Network, conceived and funded by American Express, is to give online retailers information about ways to prevent fraudulent card transactions, and resources for doing so. The coalition, announced at the National Retail Federation’s trade show, also plans to try to debunk the public perception that online transactions are unsafe.

Merchants leading the organization include, a virtual store that specializes in electronics, and, a travel site. Other founding members are payment processors First Data Corp. and Paymentech and software vendor ClearCommerce Corp.

Marie Aloisi, American Express’ vice president of retail industries, said one of the group’s first actions was to hire consultants from GartnerGroup Inc. to evaluate fraud prevention technologies. The Stamford, Conn., consulting firm is to issue its report by yearend, and the coalition will make the results public on its Web site,, she said.

Ms. Aloisi, who is spokeswoman for the anti-fraud group, said her company’s initial investment in the coalition — how much, she would not specify — means that any organization or business that maintains minimal security practices can join at no cost. After a year, she said, the founding merchants will be responsible for the coalition’s finances.

The point of the coalition is to help Web merchants cut back on the high costs of fraud by sharing practices on prevention. “E-commerce is growing meteorically, and the potential for fraud to grow is there, too,” Ms. Aloisi said.

She said American Express is in an ideal position to lead the anti-fraud effort because of the company’s “closed-loop network” for card transactions. Because of this network, the company can easily track cardmembers and merchants during an investigation, she said.

Julie Fergerson, chief technology officer and co-founder of ClearCommerce of Austin, Tex., said the coalition would try to give merchants a clear breakdown of their security options. “With merchants, there are so many ways to go about it,” she said. “It’s hard for merchants to know what to use.”

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