Equifax announces the $640 million purchase of fraud prevention specialist Kount

Darren Sinden

Online fraud is a growth industry, a 2019 report by American Express suggested that as much as 27% of all online sales turn out to be fraudulent

Global data analytics company Equifax has its buying boots on and is splashing out $640 million on Kount, a business that provides fraud prevention and protection software for online transactions through risk-based authentication.

Kount’s technology covers the whole transaction process from account creation and opening, through to payments and disputes, as well as helping to reduce failed transactions and card chargebacks.

Kount software uses both machine learning and artificial intelligence techniques to verify identity and create trust scores for the validity of online transactions by screening vast data sets to establish identifiers and patterns of behaviour, and its identity trust network is used by 9,000 brands worldwide to protect them against digital fraud.

Kount came to life in 2007 and the company now has 39 patents in digital fraud prevention and has another 9 applications outstanding. The business is headquartered in Boise, Idaho and has been backed by the likes of CVC Ventures, who put $80.00 million into the business back in 2016.

Equifax is probably best known as a consumer credit rating agency and a competitor to the UK listed Experian. Equifax employs 11,000 staff and operates in 24 countries around the globe. It is an S&P 500 constituent, with a market cap of $22.60 billion.

Equifax has itself been a victim of cybercrime and was notoriously hacked in 2017. A data breach that compromised the personal information of 147 million people. Equifax agreed to pay $575 million in settlement of claims arising from that incursion.

Online fraud is a growth industry, and in the UK alone in 2019 there were estimated to have been 2.75 million fraudulent transactions. More than double the figure for 2014, according to Statista data.

A 2019 report by American Express suggested that as much as 27% of all online sales turn out to be fraudulent. Furthermore, the American Express survey found that 37% of all attempted online transactions were abandoned in 2019. Up from 31.0% seen in 2018.

Almost 77% of the merchants surveyed by Amex said that their company had been a victim of some type of fraud. More than 30% said that this had involved stolen or counterfeit cards and 36% highlighted chargeback fraud as an issue.

Equifax believes that by purchasing Kount it will be able to continue to crack down on this type of fraudulent behaviour.

Mark Begor CEO of Equifax was quoted as saying that: “Equifax is taking advantage of our strong 2020 outperformance and cash generation to make this strategic acquisition.”

And that “Our data and technology cloud investments allow us to quickly and aggressively integrate new data and analytics assets like Kount into our global capabilities and bring new market-leading products and solutions to our customers.”

Chargeback fraud and other online payment scams have been a constant thorn in the side of FX and margin trading brokers for many years, and any innovation that can help to reduce their incidence is to be welcomed.

Read this next

Digital Assets

INX combines SEC-registered security tokens and cryptos in one platform

“By bringing together our security token trading platform with our cryptocurrency trading platform and primary offering services, INX is pioneering a new era of digital asset investing for both primary and secondary markets that benefits everyone – not just a select few.”

Industry News

Bitso launches QR code payments for crypto in Argentina

“This is an especially important product offering for Argentina as it provides users protection from the adverse economic factors such as inflation and currency devaluation.”

Institutional FX

CLS FX volume continues downward trend in August

Total daily traded volume submitted to CLS for settlement took yet another step back in August.

Digital Assets

Huobi taps AstroPay to facilitate fiat-to-crypto payment in Latin America

Huobi, the world’s sixth-largest crypto exchange by trading volume, has recently partnered with payment solution provider AstroPay to launch local currency account deposits and withdrawals in Latin America.

Digital Assets

Crypto exchange FTX to raise $1 billion at flat valuation of $32 billion

FTX is reportedly in discussions with a clutch of heavyweights from traditional finance to raise up to $1 billion in fresh funding to fuel more deal-making.

Digital Assets

Revolut US launches trading on Avalanche, Solana, and Dogecoin

British fintech and banking firm Revolut has further expanded its cryptocurrency offering in the US with the addition of 29 new tokens.

Digital Assets

Bahrain greenlights eazyPay to launch Binance Pay

The Central Bank of Bahrain has blessed a new partnership inked by Binance with Eazy Financial Services ‘eazyPay’, a local POS and online payment service provider. The greenlight enables EazyPayto to launch Bitcoin and cryptocurrency payments in the region.

Digital Assets

Coinbase approved to offer crypto for Dutch users

Nasdaq-listed crypto exchange operator Coinbase has been handed regulatory approval to operate as a crypto service provider in the Netherlands.

Metaverse Gaming NFT

AC Milan partners with Solana-based NFT football game MonkeyLeague

“Partnering with champions like AC Milan, an absolute iconic Club throughout footballs history, is another testament to what we are building and where we are headed as a game and game studio. It also represents a key step in our plans to bridge the Web2 and Web3 worlds.”

<