Paypal Buys Fraud Sciences
January 29, 2008 | by Christopher Nickson
Paypal is spending $170 million to purchase the Israeli company Fraud Sciences, a move that will not only help it but also its parent company — eBay.
It seems as if most of the world knows Paypal and eBay these days; they’ve become ubiquitous. With that fame has come greater possibilities of fraud – simply witness all those phishing e-mails.
But now Paypal has acquired Fraud Sciences, an e-commerce security company run by two former members of Israel’s Mossad secret service, E-Commerce Times reports. The sale is expected to go through within 30 days for $170 million cash, and with Fraud Science founders Shvat Shaked and Saar Wilf both joining Paypal’s technology and fraud management teams.
"Integrating Fraud Sciences' risk tools with PayPal's sophisticated fraud management system should allow us to be even more effective in protecting eBay and PayPal's hundreds of millions of customers around the world," said Paypal’s president, Scott Thompson.
Fraud Sciences has proved popular with merchants as it allows them to verify the identities of purchasers, which inevitably decreases fraud, and it will prove useful not only to Paypal, but to eBay itself, which has had its share of fraudsters over the years, an almost inevitable outgrowth of the kind of business it’s in.
The acquisition will help Paypal as it pushes its non-auction business, in spire of competition from Google Checkout.
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