Essential Industry Terms Explained

Ghost terminal, used in recent reports of skimming crimes, are electronic devices tailored to copy a credit card’s magnetic strip and Personal Identification Number in order to steal money from an...

Gift cards are a popular way for scammers to steal money from you. This is because gift cards are like cash: if you buy a gift card and someone uses it, you probably cannot get your money back....

Address validation is the process of checking a mailing address against an authoritative database to see if the address is valid. If the address in question matches an address in the official...

The word government refers to a group of people that governs a community or unit. A government sets and administers public policy and exercises executive, political and sovereign power through...

Government fraud refers to when an individual purposefully deceives the government so as to benefit from this deception. Examples of government fraud include tax evasion, welfare fraud, and...

In a typical grandparent scam, a con artist calls or emails the victim posing as a relative in distress or someone claiming to represent the relative (such as a lawyer or law enforcement agent). The...

In a computer system, hacking generally refers to any unauthorized intrusion into a computer or network. The person engaged in hacking activities is known as a hacker. A hacker may alter system or...

A Hash or hash function is a function that can be used to transform digital data of an arbitrary size to digital data of a fixed size. The values returned by a hash function are called hash values,...

Healthcare fraud is a type of white-collar crime that involves the filing of dishonest health care claims in order to turn a profit. Fraudulent health care schemes come in many forms, such as...

A high-risk industry describes when a type of business proves to have higher rates of failure than others. If businesses in a certain sector, like beer production, have higher rates of failure over...

A Honeypot is decoy computer system designed to identify and/or trap hackers and other malicious actors. A honeypot sometimes offers a tempting set of data to attract fraudsters and counteracts their...

Hospitality is a term used to describe how well a certain location or entity accommodates somebody. If a person is well accommodated for when they visit somewhere, it would likely be said that that...

In device technology, host card emulation is the software architecture that provides exact virtual representation of various electronic identity (access, transit and banking) cards using only...

A hybrid intrusion detection system is used to provide increased detection capabilities. HNID integrates a neural network detection component with a basic pattern matching engine to detect anomalies...

The Invisible Internet Project (I2P) anonymous network layer that allows for censorship-resistant, peer to peer communication. Anonymous connections are achieved by encrypting the user's traffic (by...

What is Impersonation of the Deceased Fraud? Impersonation of the deceased fraud, also known as ghosting, is a type of identity theft that occurs when someone uses the personal information of a...

An Internet Protocol address (IP address) is a rational numeric address that is assigned to each computer, printer, or some other device that is considered to be a part of a TCP/IP-based network. An...

Internet Protocol or IP Address Verification could be defined as a set of processes and procedures that ensure that everything you produce, buy, or sell on the Internet will have a legal and...

ISP monitoring is the practice through which ISPs record information about your online connections and activities. That means that everything from your search history to your email conversations are...

Identification is the process by which something denotes another object as being a part of a certain category. A human could simply be identified as a human, or could be identified as their role or...

Identity fraud is the situation where a fraudster uses the personal information of a victim, without any approval, to perform a criminal action or to mislead or defraud the other person. Most...

An identity provider is a federation partner that vouches for the identity of a user. The identity provider authenticates the user and provides an authentication token (that is, information that...

Identity spoofing occurs when a scammer assumes the identity of another person/entity and uses that identity to commit fraud. Spoofers steal credentials from people or businesses through password...

Identity theft is the fraudulent acquisition and use of an individual’s personal information, such as Social Security numbers, banking details, or login credentials, often for financial gain. Cybercriminals use stolen identities to...

Identity and access management (IAM) is a framework for business processes, policies and technologies that facilitates the management of electronic or digital identities. With an IAM framework in...

Improper disclosure refers to when information is mistakenly shown to somebody that has not been authorized by the appropriate people to see it. The term usually relates to medical disclosure, when a...

InfoSec, short for Information Security, refers to the discipline of defending information from unauthorized access, use, disclosure, disruption, modi cation, perusal, inspection, recording or...

An insider threat refers to a security risk that originates from within an organization. It involves employees, contractors, business partners, or anyone with authorized access who misuses their privileges to harm the organization...

An Instagram scam could be described a scheme fraudsters perform through the use of social media, such as Instagram, or other related applications in the smartphone, in order to gain access to...

Insurance fraud is any act committed to defraud an insurance process. This occurs when a claimant attempts to obtain some benefit or advantage they are not entitled to, or when an insurer knowingly...

Intellectual property, also known as IP, describes an item or idea that has been credited as belonging to somebody in some way. Common types of IPs would be patented or copyrighted materials.

Fraud Intelligence is the leading practical resource for the counter-fraud professional; it provides applied insight, analysis and tools to combat fraud and corruption, whether in the corporate or...

Intelligence Augmentation, or IA, is an alternative conceptualization of artificial intelligence that focuses on AI's assistive role, emphasizing the fact that cognitive technology is designed to...

What is Insider Fraud? Insider fraud refers to fraudulent activities committed within an organization by individuals with access to sensitive information, systems, or resources due to their positions...

Interoperability describes the ability of computer systems or software to exchange and make use of information. Interoperability requires mechanical compatibility among the systems, and it is only...

Inventory fraud involves the theft of physical inventory items and the misstatement of inventory records on a company's financial statements. A small business may be a victim of fraud perpetrated by...

Investment fraud is any scheme or deception relating to investments that affect a person or company. Investment fraud includes illegal insider trading, fraudulent stock manipulation, prime bank...

The Invisible Web is the part of the World Wide Web, which is not indexable by search engines and is therefore invisible. In contrast to the Surface Web, the Invisible Web consists of data and...

Also known as a zombie army, a botnet is a collection of internet-connected devices that an attacker has compromised. These botnets can try to infect more computers or spread spam for affiliate...

The Issuing Bank is the financial institution which issues individuals with credit cards or debit cards and extends short-term lines of credit to purchase goods and services. Familiar issues include...

Jitter is an anti-skimming method that alters the information on the magnetic stripe by changing the bustle or gesture of the card while it is swiped or dragged into a card reader or ATM. Jitter is...

A keylogging program logs the keypresses on a device. Fraudsters covertly download these onto devices through various methods, and then read the keys recorded in order to discover things like the...

Keystroke dynamics or typing dynamics refers to the automated method of identifying or confirming the identity of an individual based on the manner and the rhythm of typing on a keyboard. Keystroke...

A keylogger, sometimes called a keystroke logger or system monitor, is a type of surveillance technology used to monitor and record each keystroke typed on a specific computer's keyboard. Keylogger...

A kickback is an illegal payment intended as compensation for favorable treatment or other improper services. The kickback may be money, a gift, credit, or anything of value. Paying or receiving...

Know Your Business (KYB) is a regulatory process undertaken by financial institutions, payment processors, and other businesses to verify and validate the legitimacy of the companies they engage with. KYB plays a critical role in ensuring compliance with legal requirements, preventing financial crimes, and maintaining the integrity of the global financial ecosystem.

Know-Your-Customer, or KYC, refers to a set of due diligence practices that banks, financial institutions, merchants, etc., must perform on customers before doing business with them. The goal of...

Know Your Merchant (KYM) refers to the process through which financial institutions, payment processors, and other entities validate and monitor the businesses (merchants) they work with to prevent fraud, financial crimes, and non-compliance with regulatory requirements. KYM processes are integral to identifying high-risk businesses, ensuring compliance with laws and regulations, and mitigating risks associated with financial and reputational harm.

Know Your Vendor (KYV) refers to the process by which organizations assess, validate, and monitor the vendors and suppliers they work with to ensure compliance with regulations, reduce operational risks, and foster ethical and transparent business practices. It is a strategic approach to safeguarding supply chains, protecting brand reputation, and mitigating vulnerabilities that could arise from engaging with unverified or high-risk vendors.

Law enforcement could be described as a system where a number of members of society act in a systematic way to enforce the law, determining, discouraging, assimilating or even punishing those who...

Lending (also known as "financing") in its most general sense is the temporary giving of money or property to another person with the expectation that it will be repaid. In a business and financial...

A Level of Assurance, as defined by the by ISO/IEC 29115 Standard, describes the degree of confidence in the processes leading up to and including an authentication. It provides assurance that the...

Liability shift generally refers to the responsibility of covering the losses from fraudulent transactions moving from the merchant to the issuing bank when the merchant has authenticated the...

A log file is a file that keeps a registry of events, processes, messages and communication between various communicating software applications and the operating system. Log files are present in...

A login is a set of identifications used to validate a user: this generally involves a username and password that allows a person to log in to a computer system, network, mobile device, or user...

The process that recognizes and validates a user's identity is known as login authentication. A common example is having to enter both a username and password into a website in order to gain access...

A lottery scam is a type of advance-fee fraud which begins with an unexpected email notification, phone call, or mail-letter (sometimes including a large check) explaining that "You have won!" a...

Loyalty points fraud occurs when a fraudster gains access to somebody else's loyalty rewards points account, and then redeems these points for products that will benefit the fraudster. This type of...

What is Multi-Factor Authentication (MFA)? MFA or Multi-Factor Authentication, also called Step-Up Authentication, is an approach to security authentication, in which the user of a system provides...

Machine learning (ML) refers to the development of computer algorithms and statistical models to perform predictions and specific tasks without explicit instructions, rather using inferences and...

Mail fraud and wire fraud are federal crimes in the United States that involve mailing or electronically transmitting something associated with fraud. Jurisdiction is claimed by the federal...

Mail Order Telephone Order (MOTO) is a type of card-not-present (CNP) transaction in which services are paid and delivered via telephone, mail, fax, or internet communication. With the introduction...

Malware is software that is intentionally designed to cause damage to a computer, client, server or the network of a computer. Hostile, intrusive, and intentionally nasty, malware seeks to invade,...

A man-in-the-browser is a type of online threat, where a hacker uses a trojan horse virus to gain access to your computer. From there, the hacker manipulates the content you see within your web...

Man-in-the-middle (MITM) is an attack where the attacker secretly relays and possibly alters the communications between two parties who believe they are directly communicating with each other.

Manpower Direct Costs include wages for the employees that produce a product, including workers on an assembly line, while indirect costs are associated with support labor, such as employees who...

Manual review is a technique that can be performed in-house or may be outsourced to or managed by a third party vendor. In either case, staff members perform manual checks on orders to determine the...

Manual submission describes when somebody adds URLs to a search engine manually, filling out the form fields individually. This differs from automatic submissions, which involve filling out...

A marketplace is the real, virtual or metaphorical space in which a market operates. The term is also used in the trademark law context to denote the actual consumer environment, i.e. the 'real...

What is Marketplace Fraud? Marketplace fraud is the illegal practice of making false or misleading claims through a company. This includes exaggerating the qualities of a product or service in...

Medical fraud is a type of white-collar crime that involves the filing of dishonest health care claims in order to turn a profit. Health care fraud influences insurance rates every day, causing...

Medical identity theft occurs when somebody illegally accesses and uses a patient's personally identifiable information (PII) to obtain medical treatment, services or goods. The stolen information...

A merchant account is a type of bank account that allows businesses to accept payments made by debit or credit cards.

Merchant account providers give businesses the opportunity to accept debit and credit cards for the payment of goods and services. This can be conducted face-to-face, over the phone, or even over the...

Is 3D Secure a better alternative to Chargeback Insurance?  We think so. Contact us to learn why. Chargeback insurance is an insurance product that protects merchants who accept credit card payments....

Misrepresentation is a concept of English law, which describes when a party uses misleading statements or facts in negotiations to induce the other party to take certain actions.

A "mobile" is a term used for phones, stemming from the term "mobile phones", which differs from their predecessor, wired or immobile phones. A mobile phone is a portable device whose primary use is...

Mobile device analysis is a branch of digital analysis that refers to the recovery of digital evidence or data from different mobile devices under the analysis of a sound condition. Mobile devices...

Mobile phone fraud is simply any fraud that involves the use of mobile phones. One type of this fraud is call-forwarding fraud, where a fraudster tricks a victim into mistakenly forwarding their...

What is Money Laundering? Money laundering is the process of transforming "dirty" money derived from criminal activities, such as drug trafficking, corruption, fraud, or illegal arms sales, into...

Money mule schemes involve individuals, often unknowingly, who transfer illegally obtained funds on behalf of others. These individuals, known as "money mules," are recruited by fraudsters to launder money stolen from businesses...

The term monitoring refers to the observing and checking of the progress or quality of something over a period of time. Monitoring services generally ensure the security and authenticity of something...

Mortgage fraud is a crime in which the fraudster omits information on an application for a mortgage loan to obtain to greater loan than they would likely normally be eligible to recieve.

Mousetrapping is a technique used by websites to keep its visitors on the website for longer, and also to force visitors to engage with their website. It may occur from a website launching pop-up ads...

Multichannel merchanting describes the process of trying to sell products to both current and potential users through a variety of channels.

Near-Field Communication, also known as NFC, is the set of communication protocols that allow two electronic devices to share information with one another based on their proximity to each other. NFC...

Network Effect, is a phenomenon in which a good or service gains additional value as more consumers use it. Technically, the term refers to the effect that one individual user of a product or service...

A neural network is a progression of algorithms that attempt to copy the manner in which the human cerebrum works in order to draw connections between different pieces of information. Neural systems...

What is New Account Fraud? New account fraud occurs when fraudsters use stolen or synthetic identities to open new accounts with financial institutions, online retailers, or other businesses for...

Nonrepudiation is the assurance that somebody can't deny something. Typically, nonrepudiation refers to the ability to ensure that a party of a contract or a communication cannot deny the...

Omnichannel is a cross-channel content approach that companies use to improve their user experience. Instead of working in comparable communication channels, communication channels and their support...

On-premises software (also known as on-premise, and shortened "on-prem") is implemented and activates on computers on the premises of the individual or company using the software, rather than at a...