March 13, 2018
Investors, noting the growth in e- and m-commerce worldwide and the concurrent growth in CNP fraud targeting merchants and banks, continue to validate the online fraud-prevention space with funding projects. Most recently, BioCatch, a startup born in Israel with a growing U.S. presence offering behavioral biometrics to detect and prevent online fraud, secured $30 million from a variety of investors.
Behavioral biometrics technology—invisible to users—detects anomalies in the way users interact with their devices (e.g., the patterns a person normally swipes on a touchscreen or the time they usually spend on a certain task) and assesses the likelihood that a transaction is being performed by the legitimate account holder.
The funding was led by San Francisco-based Maverick Ventures, with participation from American Express Ventures, NexStar Partners and others. The wave of account takeover, new account creation and syntetic fraud—fueled by oceans of available personal and account information stolen in massive data breaches—is one trend that has banks and merchants scrambling to keep up with well-armed fraudsters.
“BioCatch helps to answer the question, ‘who are you’ in an online world where fraudsters operate with the legitimate credentials of others, making it very hard to distinguish them from authorized users,” said Howard Edelstein, CEO of BioCatch. “We take pride in the track record we have amassed and the role that we play as an integral part of our clients’ identity strategy. This strategy cuts across the digital ecosystem, from stopping fraud in real-time to preventing fake accounts from being opened in the first place, all while enabling a seamless user experience.”