program: Fraud Monitoring
- authority: Mastercard SPME §3.7, §11.1.1
+ authority: Mastercard SPME §3.7, §11.1.1, §8.4
fraud_to_sales_ratio_threshold: 0.015
min_count_per_month: 100
monitoring_cadence: monthly
escalation_actions:
  - escalate_to_human_review
  - notify_acquirer
lookback_period_months: 1
remediation_review_interval_days: 30
agent_owner: fraud_ops_agent
 
# MATCH fraud detection features are limited to principal owners only; associate owners and Service Provider name reporting are removed per SPME §11.1.1.
# Acquirers may add and search for information on up to five principal owners per Merchant.
# Multiple data fields are used to determine matches; MATCH supports editing and error notification to reduce delays.
# Retroactive alert processing is supported for data up to 360 days old.
# Acquirers control receipt and detail of inquiry match information.
# Real-time access via MATCH Online and API, and batch operations remain available.
# Merchant URL information may be added and searched.
# Crucially, after obtaining MATCH inquiry results, Acquirers must assess whether further investigation or risk mitigation actions are warranted, per updated SPME requirements.
+ 
+ # Enhanced Fraud Monitoring Criteria per SPME §8.4:
+ # Incorporate quantitative thresholds for identifying Questionable Merchants including minimum transaction volume (≥ USD 50,000), transaction count (≥ 5), and fraud indicators such as elevated fraud-to-sales ratio (≥ 70%), high authorization declines or issuer referrals (≥ 20%), recent merchant activity (< 6 months), or disproportionate fraud/decline volume relative to approved transactions.
+ # Utilize these criteria in ongoing fraud monitoring to escalate appropriate cases for review and possible recovery efforts under QMAP provisions.
+ # Note: Transactions not processed via Mastercard systems are excluded from these determinations.
+ # Mastercard retains sole discretion to designate Questionable Merchants based on these and other relevant factors.

Fraud Monitoring

Halyard Pay monitors merchant fraud activity and leverages Mastercard's MATCH system for enhanced fraud risk assessment on merchants processed through our platform.

When this policy applies

This policy applies to all merchants processed by Halyard Pay where Mastercard is the applicable network, covering both card-present and card-not-present transactions.

Required actions

1. Compute the merchant's rolling fraud-to-sales ratio each calendar month.

2. If the ratio meets or exceeds 1.5% and the fraud count reaches at least 100 transactions in that month, escalate the merchant account to human review immediately.

3. Utilize Mastercard's MATCH system data focusing on principal owners only, as per the updated Mastercard SPME guidelines. Do not consider associate owners or Service Provider names in fraud assessments.

4. Incorporate the Questionable Merchant Audit Program (QMAP) criteria from Mastercard SPME §8.4 to identify high-risk merchants. This includes assessing if a merchant has submitted at least USD 50,000 in transaction volume over a 120-day period and evaluating specific fraud-related conditions such as high fraud-to-sales ratios and issuer declines.

5. After accessing MATCH data, data and applying QMAP criteria, conduct a comprehensive risk assessment to determine whether further investigation or additional measures are warranted.

5. 6. Notify the acquiring compliance officer and document the case ID with supporting transaction data.

6. 7. Track case progress until the account returns to threshold compliance or is terminated.

Source authority: Mastercard SPME §3.7 and §11.1.1.§§3.7, 8.4, and 11.1.1.