The credit bureau TransUnion LLC and the marketing data company Acxiom Corp. are expected to announce today a jointly developed product meant to help financial institutions fight fraud.
Though using both companies' data on a shared platform is new, the partnership between the Chicago credit bureau and Acxiom, which houses one of the world's largest collections of consumer information, is not.
Acxiom, of Little Rock, buys data from all three major credit bureaus - TransUnion, Equifax Inc., and Experian Inc. But Rick McGraw, business development leader at Acxiom, said Friday that TransUnion is its preferred U.S. vendor. (The company uses Equifax data for its business in Britain.)
Fraud Management Platform is one of many products developed with TransUnion that Acxiom has sold or plans to sell, Mr. McGraw said.
He spoke in a conference-call interview along Jeffrey Hellinga, the president of TransUnion's analytic decision services group. Mr. Hellinga said the companies' databases are complementary.
Most of Acxiom's customers use its data to help target their marketing campaigns. Lenders use TransUnion (which is part of the Marmon Group of companies, owned by the Pritzkers) to decide whom they should extend credit to and how much. TransUnion holds the account histories of nearly every American with a line of credit. It also has identifying data - such as name, address, and Social Security number - and public-record information.
Fraud Management Platform will pull identifying data from both companies. Financial institutions could use it to screen applicants and authenticate current customers.
"Fraud doesn't only happen at the beginning of a relationship," Mr. Hellinga said; it is a risk anytime a customer contacts the institution, for examples, to increase a credit line, change an address, or consolidate accounts.
Acxiom's customers had been asking for a more comprehensive fraud solution, McGraw said. The trend from face-to-face to electronically initiated transactions at retailers and banks requires more sophisticated authentication, he said.
Fraud Management Platform will use Acxiom's technology to link the companies' data and TransUnion's analytics to score each transaction's risk. "The goal of both our organizations is for this new combined offering to eventually replace and outperform all of our existing fraud products and services," Mr. Hellinga said.
TransUnion currently offers ID verification and fraud detection products.
Experian, of Costa Mesa, Calif., also sells an authentication product for banks and retailers. And it offers membership to what it calls a National Fraud Database, which contains records of verified incidents of fraud, against which lenders and retailers can check credit applications.
Ted Crooks, the vice president in charge of fraud products at Fair Isaac Corp., the country's leading analytics vendor and the developer of the FICO score, said it is developing an authentication product that uses multiple data sources.
The product, which Mr. Crooks called an "identity clearing house," would exchange immediate transaction information among credit card issuers, retail banks, merchants, mortgage companies, telephone companies, and health-care providers for verifying customers.
Fair Isaac, based in San Rafael, Calif., says it has an 85% share of the U.S. market for fraud monitoring products. "We expect it will be a winner-take-nearly-all market," Mr. Crooks said.
