Online Payments Risk Management & Fraud posted by: Andrew Nossiter

Ohad Samet: Online Payments are as Risky as it Gets

Ohad Samet is concerned about fraud, but not in the way that you might think. It’s not merely the threat of fraud itself, but risk in general, and the repercussions it can have on business decisions: risk restricts growth, and causes panic. “Don’t let risk prevent you from seeking out and acquiring new business, but be vigilant. It’s all about finding a balance.” The message? Don’t let the threat of potential fraud scare you off from accepting new customers and pursuing new opportunities!

Originally hailing from Israel, Ohad has a broad range of experience in online risk management, with a CV that reads like a detective novel of different security positions at companies like Paypal. He was kind enough to stop by the Balanced offices on July 10th to host an open discussion focusing on some of the issues explored in his new book, Introduction to Online Payments Management. Anyone involved in online payments is probably already aware of the threat caused by fraudulent transactors, but Ohad’s message is simple: “It’s not about stopping the bad guys, it’s about accepting more good guys.”


Traditional fraud prevention has historically been done in a gatekeeper format; err on the side of caution, shut people down early, and do so without enough warning to give them time to change their game. The unfortunate truth is that, while this will indeed prevent fraud, innocent transactors get caught in a wide net, and a marketplace will lose legitimate business. By focusing on good users rather than fraudulent ones, you establish consistent patterns of use that help tip you off when something doesn’t look right.

Assessing Risk

As shocking as it may seem, at times it can be hard to convince managers to focus on risk (after all, it’s a lot more fun to emphasize growth!). So, what can you do? Ohad’s suggestion is to marry the two, “showing how risk enables growth, rather than restricting it”. In the long run, focusing attention on risk will help to develop a gut feeling for users who are up to no good, as well as those who may just look suspicious, but are merely inexperienced with online marketplaces.

Proactive Action

How, then, are you supposed to confront the specter of risk, and by default, fraud? Use the right tools. First, make sure that everyone on your team is on the same page: have a solid set of rules and procedures in place, and make sure everyone on your team is on the same page. Creating a scalable, repeatable response to fraud issues enables you to get the information you need right away while avoiding confusion and making sure that you have the documentation you need down the road. It’s important to take care of issues as they arise, but always keep in mind the long run endgame: six months down the road you want to be able to spot repeat offenders, and quickly see their past patterns of fraud.

Learn More

Interested in learning more about online risk? You can visit Ohad Samet’s blog here, where you can can also download a free copy of his most recent book, Introduction to Online Payments Management. As Ohad puts it in his own words, “I believe that there is lots to share in risk management and fraud prevention that can advance web safety”.