Meet the Loyalty Fraud Prevention Association (LFPA)

Nov 5, 2018

Fraud is a challenge for many – if not most – industries, but, it’s particularly vexing to the loyalty sector. From amateurs gaming the system to sophisticated hackers exploiting vulnerabilities to internal threats, loyalty programs are enticing targets for fraud. And because loyalty programs are often linked with credit cards and consumer data – and because rewards often represent significant value – combatting fraud should be a major priority for professionals in this industry.

At Kobie, we believe this should not be a unilateral priority; brands across all categories must work together on this issue. The ability to effectively combat fraud should not be a competitive advantage, rather the capabilities to track, identify and prevent fraudulent activity need to be communicated widely. After all, criminals have no allegiance to one brand or another – today your competitor may be victimized by fraud, tomorrow it could be your business (and your customers).

You may be glad to learn that there is an organization dedicated to fighting fraud in the loyalty sector – the Loyalty Fraud Prevention Association, or LFPA.  Kobie is proud to be a founding member of this valuable organization and attend their Fall Conference this week, where we hope to gain even more insight into the broad topic.

While the loyalty sector doesn’t have a clear set of standards like PCI-DSS for the credit cards, the LFPA is working to formulate similarly effective guidelines. Founded in 2016 by Airline Information to support the loyalty industry in its fight against fraud, hacking and theft of valuable loyalty program points and miles, the LFPA helps loyalty programs understand loyalty fraud prevention, serves as a resource and central database for known loyalty fraudsters, establishes best practices for preventing fraud, and educates loyalty program members via workshops and conferences – like the one we’re attending.

The LFPA also allows and encourages collaboration among industry professionals by running forums (open to registered members only), providing a repository of data elements that have been used in confirmed fraudulent transactions, and giving industry professionals a platform to exchange experiences and learn from one another.

Individuals, companies and organizations that are running or are involved in running a loyalty program are eligible to become members of the LFPA. Member benefits include access to ongoing workshops and an annual conference, discounted access to the THESEUSS database (or “blacklist”) of known fraud perpetrators, a dynamically-updated list of best practices, training in both fraud security and fraud detection, and a platform to connect to like-minded peers in the industry.

If you or your organization are interested in joining the LFPA, and joining Kobie in the fight against loyalty program fraud, contact Peter@LoyaltyFraudAssociation.org.