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Unauthorised online merchant aggregation refers to an offending online merchant who allows third parties to use its payment acceptance facility for a fee. Merchant sales are still deposited to the approved merchant depositing account.
Most experienced payment gateways already have capabilities to prevent the most common techniques used to aggregate transactions.
One Sentry provides APIs for clients who do not have such a capability to prevent merchant aggregation.
What about Brick & Mortar?
Unauthorised aggregation of payments is certainly not something new. In the Face-2-face fraud world, this is known as terminal laundering (sometimes termed “walking terminals”). Existing techniques already exist to mitigate terminal laundering risks, some of which will also work very well in eCommerce acquiring.
Defending against the evolving fraud landscape
In recent times, we have uncovered clever merchant online aggregation tricks where fraudsters have gone back to basics in order to counter all forms of payment aggregation detection mechanisms. While they may appear to work at the onset, advanced analytics have enabled acquirers to identify offending merchants very quickly.