January 22, 2013 07:00 ET

Big Data Underwriting Platform Zebit Announces Fraud Killer "Vulcan"

New Model Reduces Fraud by 90% as 2013 Expects Record Levels of Online Fraud

SAN DIEGO, CA--(Marketwire - Jan 22, 2013) - Zebit, a financial services technology startup offering a Big Data underwriting platform enabling business with the underbanked, announced today that it has launched a new fraud detection model reducing fraud by 90%. Nicknamed "Vulcan" for the mind-melding Mr. Spock of the Star Trek series, the model employs Adaptive Data Fusion technology which learns and adapts to fraudster tactics, "getting into the minds" of fraudsters to proactively respond to attacks before the fraud is committed.

"Our goal has always been to apply advanced analytics in ways that enhance the customer experience and ultimately, people's lives," said CEO Michael Thiemann. "By significantly reducing fraud, we can help lower interest rates, reducing the cost of borrowing for a population for which cost savings makes a particularly big impact. Partners on our platform will enjoy a dramatic reduction in fraud losses."

Designed by the data scientists and fraud experts who built the fraud detection system protecting over 2 billion credit cards worldwide, the system is the most sophisticated of its kind. With advanced behavior monitoring, Vulcan employs technology typically used in scientific and military applications to take large, complex streams of data from multiple sources to form inferences that are superior to using the data streams individually.

Individuals that are not Zebit customers will appreciate that Vulcan protects them against the possibility of having stolen identities used in a short-term lending transaction. Globally recognized fraud expert Ted Crooks of Crooks Analytics predicts that global internet fraud levels will accelerate this year when Chip and PIN technology is introduced on payment cards on a widespread basis in the US, and that transactions involving cash transfers are at particular risk. Cash transfers are an integral part of any business involving lending, ranging from retailers offering financing to direct lenders. 

As the last major market using payment cards without widespread protection from an embedded computer chip and PIN requirement at point of sale, the US is due for a payment card upgrade. Beginning in 2013, the major credit card companies plan to make these new smartcards standard throughout the US. Though the new technology reduces fraud in face-to-face transactions, it encourages a rise in online fraud.

"The UK saw huge spikes in internet fraud when they transitioned to Chip and PIN between 2006 and 2008, with overall losses from internet fraud exceeding the savings from reduced instances of face-to-face fraud for several years," said Crooks. "We expect to see the same in the US."

"Higher quality underwriting and fraud protection allows us to give more customers who really need it access to capital," said Michael Thiemann. "When lenders can offer customers fair rates and make the right lending decisions without the wildcard of fraud, everyone wins."

About Zebit
Zebit is a Big Data underwriting platform from financial services technology company Global Analytics offering companies a simple way to do business with the underbanked. Zebit was developed by the same team who built the fraud detection system protecting over 2 billion credit cards worldwide, and its advanced analytics platform saves end consumers money while getting companies profitable up to 75% faster.

Zebit raised a $25M venture round in 2012, was honored as one of Red Herring's Top 100 Tech Startups and nominated in the Best Prepaid Innovation category in the 2012 Prepaid Awards in the UK.

Zebit is a registered trademark of Global Analytics Holdings, Inc. Other marks are the property of the companies with which they are associated.

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