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What is IP risk scoring?

An IP address is the jumble of letters and numbers that uniquely identifies every device connected to the Internet, from your phone to your smart fridge. It’s what makes it possible to automatically connect to a website, send or receive an email, use a chat room and more. Public IP addresses are generated by your internet service provider and are dynamic, meaning they change each time you log in. There can be no two identical public addresses, which makes IP address analysis a powerful tool for fighting fraud.

Fraudsters can tell a lot about the user behind a particular IP address IP address risk score, including where they’re based in the world and what kind of network setup they have (Wi-Fi, wired connection, mobile data) that enables them to connect online. They can also identify whether or not a person is using a proxy server to mask their true location and/or identity. This information can then be used to commit fraud, for example by impersonating a trusted user, making fraudulent purchases, or by launching a DDoS attack.

To combat this, many organizations rely on an IP reputation score that assesses the risk of users and their transactions by connecting to a global network of hundreds of thousands of other organizations and millions of devices worldwide. This network combines data from a range of sources, including a wide variety of third-party solutions that analyze behavior, links and patterns to spot suspicious activity.

An effective IP reputation score can be a powerful fraud detection solution and help prevent your organization from becoming a victim of malicious attacks that are increasing in frequency and scale. However, many fraudsters have discovered ways to outsmart existing IP reputation scoring systems and continue to find new methods of attacking brands online.

A popular method is to leverage proxy usage, which is a technique in which a person connects to the Internet using an external server, often one that’s configured to appear as though they’re accessing the Internet from a different geographic location. This can be used to mask the location of a computer in Asia and make it seem like it’s connected from a home in the U.S. This can be used to spoof the location of a credit card or other type of payment in order to conduct a fraudulent transaction.

Another strategy used by fraudsters is to cycle through residential IP addresses, which can be purchased cheaply on the black market, in order to evade detection. This hopping between IP addresses causes problems for IP reputation services because it’s difficult to track and block the activity using a single referenced blacklist.

To overcome these challenges, fraudsters must be stopped before they can launch their malicious activity. To do this, they must be identified at the point of entry – a process that involves evaluating a wide range of data points and signals to detect suspicious users, clicks and transactions. For this, businesses need a robust reputation scoring solution that provides real-time results without impacting the experience of legitimate users. This is what IP QualityScore does, providing enterprise-level fraud detection, bot detection and click scoring that is proven to reduce fraud by up to 70% while minimizing false positives.

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