Authentication File Validation for Payment Interception Fraud

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Solution Overview

Problem

Existing electronic payment systems lack effective mechanisms to detect and mitigate payment interception fraud, particularly in the transfer of authentication files between terminal devices, leading to vulnerabilities and potential data breaches.

Innovation Solution

Implementing a computer-centric and Internet-centric fraud detection system that includes a fraud detection device to verify the intended recipient of authentication files, perform series of validations and assessments, and generate a second authentication file upon interception detection, using a fraud detection platform with components like an intake manager, authenticator manager, and validation and assessment manager.

Engineering Contradictions & Design Principles

VSEngineering Contradiction Analysis

1Productivity

If authentication files are transferred between terminal devices in electronic payment systems, then payment transactions can be completed, but the system becomes vulnerable to interception fraud and data breaches

Engineering Contradiction:

Improvepayment transaction completionVSAvoidsecurity against interception fraud

Core Design Contradiction:

ProductivityVSReliability

Solution Approach 1:

The system performs preliminary validation and assessment of terminal devices before authentication file transfer. The validation manager assesses the payor terminal device and the validation and assessment manager performs assessments to ensure security clearance before the authentication file is transmitted, preventing interception fraud while maintaining payment productivity

Inventive Principle:

Principle #10Preliminary action

Solution Approach 2:

The system implements continuous monitoring and feedback mechanisms where the fraud detection device receives traverse data about authentication file transfers, validates the payee terminal device, and generates second authentication files when interception is detected. This feedback loop ensures security while allowing legitimate transactions to complete

Inventive Principle:

Principle #23Feedback

2Reliability

If validation and assessment procedures are performed on terminal devices, then security against interception is improved, but the time required for payment transactions increases

Engineering Contradiction:

Improvesecurity validationVSAvoidtransaction processing time

Core Design Contradiction:

ReliabilityVSLoss of time

Solution Approach 1:

Terminal device validation and assessment are performed in advance before the critical authentication file transfer. The validation manager and validation and assessment manager complete their evaluations beforehand, so that when the actual payment transaction occurs, the security clearance is already established, minimizing time delays during the transaction itself

Inventive Principle:

Principle #10Preliminary action

Solution Approach 2:

The fraud detection system operates continuously, monitoring authentication file transfers and performing validation assessments without interrupting the normal payment flow. The system maintains continuous security monitoring while allowing transactions to proceed smoothly, ensuring that security checks do not create significant delays

Inventive Principle:

Principle #20Continuity of useful action

3Difficulty of detecting and measuring

If a fraud detection system with multiple managers is implemented, then detection capability is improved, but system complexity increases

Engineering Contradiction:

Improvefraud detection capabilityVSAvoidsystem structure

Core Design Contradiction:

Difficulty of detecting and measuringVSDevice complexity

Solution Approach 1:

The fraud detection system is segmented into distinct functional managers: a validation manager that validates terminal devices, a fraud detection device that detects interception attempts, and a validation and assessment manager that performs security assessments. Each manager handles a specific aspect of fraud detection, making the complex system more manageable and maintainable while improving overall detection capability

Inventive Principle:

Principle #1Segmentation

Solution Approach 2:

The validation manager serves multiple functions by validating terminal devices, managing authentication files, and coordinating with the fraud detection device. The validation and assessment manager also performs multiple assessment functions. This multi-functionality reduces the need for separate dedicated components, simplifying the overall system structure while maintaining comprehensive fraud detection capability

Inventive Principle:

Principle #6Universality (Multi-functionality)

Data Source

PatentUS12505449B2Electronic payment interception fraud detection and mitigation system

Publication Date: 2025.12.23 SONTIQ INC

AI summary

Fraud detection within a special purpose hardware platform to detect payment interception of a first authentication file and initiate payment mitigation. A payee associated with a payee terminal device is verified as the intended recipient of the first authentication file, and the first authentication file is determined to have been intercepted in its intended delivery to the payee terminal device. A second authentication file is generated and delivered to the payee terminal device.