Merchants Fight FraudMerchants Fight Fraud

Online merchants are doing more to combat fraud, and they're feeling better about their ability to control it, according to a new survey. The Merchant Risk Council, a nonprofit group of 7,500 online merchants, financial institutions, and law-enforcement agencies, reports a 13% increase this year compared with last year in the use of methods and tools to combat identity theft, phishing, and other forms of fraud. The most popular methods are Web-address-verification systems, customer follow-up, and credit-card verification codes.

The number of merchants that identified fraud as a "big problem or out of control" dropped from 27% to 20% among merchants with annual online sales exceeding $25 million; the percentage drop was even greater among midsize and small merchants.

Still, as criminals get more sophisticated, businesses need to do the same, says Julie Fergerson, council co-chairman and co-founder of ClearCommerce Corp., a provider of fraud prevention and payment-processing solutions for online retailers. Says Fergerson: "Merchants need to have a plan in place to keep up