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Security concerns on the rise as smartphone adoption soars: Study

December 2, 2009

mobile-fraud41st Parameter Inc., a provider of fraud detection and prevention technology, expects an increase in mobile cybercrime and decreased effectiveness of traditional antifraud tactics due to the rapid adoption of new handsets and multiple operating systems.

According to a November 2009 consumer study of U.S. mobile phone users, 18.9 percent of mobile consumers now use a smartphone, and an additional 49.2 percent plan to purchase an advanced mobile device within the next two years.

Last week, Gartner reported smartphone sales in grew 12.8 percent year over year, reaching 41.1 million units.

There’s no doubt that the mobile channel is the fastest growing segment of the Internet today. For companies looking to increase their audience potential, conducting business with billions of mobile handsets is compelling.

Unfortunately, the channel’s success makes it just as appealing to cybercriminals.

The use of cookies, cache, Flash Shared Objects and IP Geolocation for detecting and preventing online fraud are increasingly ineffective.

These tactics are further degraded on mobile devices, which lack Flash and are channeled through IP blocks by telecommunications carriers, causing actual location to be misrepresented.

To effectively identify cybercrime activity, it is critical to understand which devices are transacting online, how frequently they appear and the actual proximity of each as compared to where they ought to originate.

41st Parameter’s device intelligence technology differentiates these and many other characteristics for any Internet connected device, including all smartphones, without any personally identifiable information.

While use of mobile devices for transacting online continues to be an increased potential source of fraud, another tactic exploits the explosion of newly created dedicated mobile sites as a prime target of fraudsters in the near term.

41st Parameter actively contributes as the security and risk advisors to a number of fraud prevention committees including the Financial Services Technology Council (FSTC) Mobile Payments and Banking Project.

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Giselle Tsirulnik is senior editor at Mobile Commerce Daily and Mobile Marketer. Reach her at

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