US008140418B1
`
`(12) United States Patent
`Casey et al.
`
`(10) Patent No.:
`(45) Date of Patent:
`
`US 8,140,418 B1
`Mar. 20, 2012
`
`(54) CARDHOLDER-NOT-PRESENT
`AUTHORIZATION
`
`(75) Inventors: Brandon J. Casey, San Jose, CA (US);
`Gary Wipfler, Los Altos, CA (US); Erik
`Cressall, San Jose, CA (US)
`(73) Assignee: Apple Inc., Cupertino, CA (US)
`
`(*) Notice:
`
`Subject to any disclaimer, the term of this
`patent is extended or adjusted under 35
`U.S.C. 154(b) by 532 days.
`(21) Appl. No.: 12/351,687
`
`Jan. 9, 2009
`
`(22) Filed:
`(51) Int. Cl.
`(2006.01)
`G06O40/00
`(52) U.S. Cl. ................ 705/35; 705/39; 705/40; 705/44;
`705/64; 705/67; 705/318; 705/325; 709/227;
`455/518; 370/401; 379/77
`(58) Field of Classification Search .................... 705/35,
`705/39, 40, 67, 64, 44, 318, 325; 709/227;
`455/518; 370/401; 379/77
`See application file for complete search history.
`
`(56)
`
`References Cited
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`
`(Continued)
`Primary Examiner — Harish T. Dass
`(74) Attorney, Agent, or Firm — Fletcher Yoder PC
`(57)
`ABSTRACT
`There is provided a method and system for real-time autho
`rization of cardholder-not-present transactions. An authori
`Zation request application may be implemented on an elec
`tronic device. Such as a cellular phone, a personal media
`player, or a computer. A cardholder may register a card
`account, such as a credit account, a debit account, a gift card
`account, and so forth, for participation in the real-time autho
`rization program. The cardholder may then receive authori
`Zation requests when cardholder-not-present transactions are
`attempted. Via the authorization request application, the card
`holder may approve or decline the authorization request. In
`addition, the cardholder may configure settings for automati
`cally responding to missed authorization requests. The autho
`rization request application may also allow the cardholder to
`flag automatically approved requests as unauthorized within
`a certain time period after an automatic approval response is
`sent, thereby enabling prompt detection of fraudulent activ
`1ty.
`
`16 Claims, 13 Drawing Sheets
`
`
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`Paymentis due in 7 days
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`re
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`T/2008
`2008. O166998 A1
`8, 2008
`2008, 0207203 A1
`2008, 0208743 A1
`8, 2008
`2008/02884.05 A1* 11/2008
`2009/0098854 A1
`4/2009
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`6, 2006
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`JP
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`12/2007
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`OTHER PUBLICATIONS
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`
`Sun et al.
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`Arthur
`John
`Park
`
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`1.
`CARD HOLDER-NOT PRESENT
`AUTHORIZATION
`
`BACKGROUND
`
`US 8,140,418 B1
`
`2
`ing psychological affect. Therefore, it may be desirable to
`reduce the possibility of fraud in cardholder-not-present
`transactions.
`
`SUMMARY
`
`1. Technical Field
`The present disclosure relates generally to transaction
`authorizations and, more particularly, to authorizing card
`holder-not-present transactions via an electronic device.
`2. Description of the Related Art
`This section is intended to introduce the reader to various
`aspects of art that may be related to various aspects of the
`present disclosure, which are described or claimed below.
`This discussion is believed to be helpful in providing the
`reader with background information to facilitate a better
`understanding of the various aspects of the present disclosure.
`Accordingly, it should be understood that these statements are
`to be read in this light, and not as admissions of prior art.
`Card purchases, such as via credit cards, debit cards, gift
`cards, and the like, may often be made in person or remotely.
`For example, an in-person transaction may involve handing a
`card to a store clerk or Swiping a card through a point-of-sale
`system. In-person transactions may be facilitated by an iden
`tity verification process, such as, for example, showing the
`store clerk a picture identification, signing a receipt, and/or
`entering a personal identification number. Cardholder
`present transactions rely upon several security mechanisms to
`deter fraud, including a physical card with raised numbers,
`holographic images, signature line, card Verification values
`embedded within the payment cards magnetic stripe, and/or
`various information protection mechanisms embedded into
`integrated circuits.
`In contrast, remote transactions may occur without identity
`verification or physical fraud deterrents found in modern
`payment cards. For example, a consumer may purchase an
`item online or via the telephone without presenting a physical
`card to the vendor. These transactions may be known as
`cardholder-not-present, card-not-present, or customer-not
`present transactions because the customer and card are not
`present at the point of sale. Cardholder-not-present transac
`tions may be more susceptible to fraudulent abuse than tra
`ditional in-person transactions because the purchaser's iden
`tity is not verified. That is, the purchaser may be required to
`enter the card number and a security number located on the
`card; however, this information may be easily copied off of a
`card and used in a fraudulent manner. In addition, although a
`billing address may be requested and compared to the billing
`address associated with a card, goods may be shipped to
`addresses other than the billing address.
`Accordingly, a card owner may not realize that a fraudulent
`cardholder-not-present transaction has occurred until a bill
`ing statement is received. It is generally preferable to detect
`the fraudulent activity as soon as possible so that additional
`use of the card may be prevented. It stands to reason, and
`widely publicized studies corroborate the fact, that losses can
`be more easily recouped when the fraud is timely discovered.
`While a consumer may be at least partially protected from
`liability when fraud has occurred, the issuing bank, acquiring
`bank, or merchant may bear the loss if goods have been sent
`to an unauthorized card user. These costs are passed on to the
`consumer in the form of higher prices on goods and services,
`higher banking fees, and higher interest rates. In addition,
`even if the consumer is ultimately not held responsible for
`unauthorized charges, it may still be very time-consuming
`and frustrating to have the charges reversed. For many con
`Sumers, the theft of one’s financial identity has a demoraliz
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`Certain aspects of embodiments disclosed herein by way of
`example are summarized below. It should be understood that
`these aspects are presented merely to provide the reader with
`a brief Summary of certain forms an invention disclosed and/
`or claimed herein might take and that these aspects are not
`intended to limit the scope of any invention disclosed and/or
`claimed herein. Indeed, any invention disclosed and/or
`claimed herein may encompass a variety of aspects that may
`not be set forth below.
`Accordingly, there is provided an electronic device for
`real-time authorization of cardholder-not-present transac
`tions. The electronic device may be a handheld device, such
`as a cellular phone or a personal media player, or it may be a
`computer, Such as a desktop computer or a laptop computer.
`Regardless of the form the electronic device takes, the device
`may run an application enabling a cardholder to approve or
`decline cardholder-not-present transactions in real time, near
`real-time, or after the transaction is initially authorized or
`settled. That is, in addition to a card transaction being sent to
`an issuing bank for approval, details of the transaction may be
`sent to the cardholder for approval before the transaction is
`authorized. If the cardholder does not recognize the transac
`tion, it may be declined immediately, thereby preventing the
`cardholder and the merchant from becoming victims of iden
`tity theft.
`Additionally, if the cardholder does not respond to an
`authorization request in real-time (i.e., within a short period
`of time), the authorization request may be responded to auto
`matically based on customizable settings configured by the
`cardholder. For example, the cardholder may enable auto
`matic approval of all missed authorizations. In another
`example, the cardholder may enable automatic approval of
`only transactions below a certain value and/or with certain
`merchants. Many automatic response settings may be avail
`able, and the cardholder may be able to combine the settings,
`for example, so that transactions up to a first value are auto
`matically approved at a first merchant, while transactions up
`to a second value different from the first value are automati
`cally approved at the second merchant.
`Further, even after an authorization response has been sent
`to the issuing bank or credit card association (e.g., Visa,
`MasterCard, American Express, and so forth), the cardholder
`may flag an approved transaction as unauthorized. In this
`way, the cardholder may quickly notify the issuing bank, the
`credit card association, the acquiring bank, and/or the mer
`chant that a previously approved transaction is fraudulent. If
`the merchant has not yet shipped goods purchased in the
`transaction, the merchant may cancel the flagged transaction,
`thereby avoiding a potentially costly loss. The issuing bank,
`once notified of the fraudulent activity, may choose to contact
`the cardholder to determine whether the card should be can
`celled to prevent potential further fraud. In other embodi
`ments, the payment application may display the issuing
`bank’s customer service phone number to expedite the pro
`cess of resolving the fraud and preventing further misuse of
`the cardholder's account information.
`This functionality may be combined with parental con
`trols, enabling parents to provide children with credit, debit,
`or prepaid cards, while allowing unauthorized or inappropri
`ate charges to be identified and declined before goods are
`shipped or services rendered. See, for example, Casey et al.,
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`U.S. patent application Ser. No. 12/351,724, entitled “Paren
`talControls. filed on the same date as the present application,
`the entirety of which is herein incorporated by reference for
`all purposes. This cardholder-not-present authorization func
`tionality may also be combined with a distinctive gesture,
`Such as a reverse Swipe of a virtual control on a touchscreen
`and/or acceptance of a modal confirmation dialog, to reduce
`the possibility of a transaction being accidentally declined
`and/or to reasonably ensure that the end user understands and
`accepts that he or she is declining a fraudulent financial trans
`action or authorizing a legitimate transaction. See, for
`example, Casey et al., U.S. patent application Ser. No.
`12/351,714, entitled “Motion Based Payment Confirmation.”
`filed on the same date as the present application, the entirety
`of which is herein incorporated by reference for all purposes.
`
`10
`
`15
`
`BRIEF DESCRIPTION OF THE DRAWINGS
`
`4
`complex and time consuming, but would nevertheless be a
`routine undertaking of design, fabrication, and manufacture
`for those of ordinary skill having the benefit of this disclosure.
`Turning first to FIG. 1, an electronic device 10 may be
`configured for verifying authorization of cardholder-not
`present transactions. As discussed below with reference to
`FIGS. 2-7, the electronic device 10 may be, among other
`things, a handheld device, a computer, or a media player
`adapted to enable a user to review and approve or cancel
`cardholder-not-present transactions
`using techniques
`described in greater detail below. As such, the electronic
`device 10 may be, for example, an iPhone(R), iPod(R), iMac(R),
`or MacBook.R., available from Apple Inc., or similar devices
`by any manufacturer. It should be appreciated that embodi
`ments of the electronic device 10 may include more or fewer
`elements than those shown in FIG. 1.
`The electronic device 10 may include at least one central
`processing unit (CPU) 12. For example, the CPU 12 may
`include one or more microprocessors, and the microproces
`sors may be 'general purpose’ microprocessors, a combina
`tion of general and special purpose microprocessors, or
`ASICS. Additionally or alternatively, the CPU 12 may
`include one or more reduced instruction set (RISC) proces
`sors, video processors, or related chip sets. The CPU 12 may
`provide processing capability to execute an operating system,
`run various applications, and/or provide processing for one or
`more of the techniques described herein. Exemplary applica
`tions that may run on the electronic device 10 include a music
`player, a video player, a picture displayer, a calendar, an
`address book, an email client, a telephone dialer, and so forth.
`In addition, software for reviewing and approving or cancel
`ling cardholder-not-present transactions may be included on
`the electronic device 10, as described below.
`A main memory 14 may be communicably coupled to the
`CPU 12, which may store data and executable code. The main
`memory 14 may represent volatile memory such as RAM, but
`may also include nonvolatile memory, such as read-only
`memory (ROM) or flash memory. In buffering or caching data
`related to operations of the CPU 12, the main memory 14 may
`store data associated with open applications running on the
`electronic device 10.
`The electronic device 10 may also include nonvolatile stor
`age 16. The nonvolatile storage 16 may represent any Suitable
`nonvolatile storage medium, Such as a hard disk drive or
`nonvolatile memory, Such as flash memory. Being well-suited
`to long-term storage, the nonvolatile storage 16 may store
`data files such as media (e.g., music files, video files, pictures,
`etc.), Software (e.g., for implementing functions on the elec
`tronic device 10), preference information (e.g., media play
`back preferences, desktop background image, ringtones,
`etc.), transaction information (e.g., credit card data, records
`of transactions, etc.), wireless connection information (e.g.,
`wireless network names and/or passwords, cellular network
`connections, etc.), Subscription information (e.g., a record of
`podcasts, television shows, or other media to which a user
`Subscribes), as well as personal information (e.g., contacts,
`calendars, email, etc.).
`In certain embodiments, a display 18 of the electronic
`device 10 may display images and/or data. The display 18
`may be any Suitable display, Such as a liquid crystal display
`(LCD), a light emitting diode (LED) based display, an organic
`light emitting diode (OLED) based display, a cathode ray tube
`(CRT) display, or an analog or digital television. In some
`embodiments, the display 18 may include touch screen or
`multi-touch screen technology through which a user may
`interface with the electronic device 10.
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`Advantages of the invention may become apparent upon
`reading the following detailed description and upon reference
`to the drawings in which:
`FIG. 1 is a block diagram of an electronic device in accor
`dance with aspects of the present disclosure;
`FIG. 2 is a front view of an embodiment of the electronic
`device of FIG. 1 in accordance with aspects of the present
`disclosure;
`FIG. 3 is a front view of another embodiment of the elec
`tronic device of FIG. 1 in accordance with aspects of the
`present disclosure;
`FIG. 4 is a schematic diagram of participants in a card
`holder-not-present financial transaction in accordance with
`aspects of the present disclosure;
`FIGS. 5-7 are screen shots of an application for registering
`a card for cardholder-not-present authorization in accordance
`with aspects of the present disclosure;
`FIG. 8 is a screen shot of an application for remote autho
`rization of cardholder-not-present transactions in accordance
`with aspects of the present disclosure;
`FIGS. 9-13 are screen shots of the application of FIG. 8
`illustrating exemplary settings for remote authorization of
`40
`cardholder-not-present transactions in accordance with
`aspects of the present disclosure;
`FIGS. 14-16 are screen shots of an application for remote
`authorization of cardholder-not-present transactions in accor
`dance with aspects of the present disclosure;
`45
`FIGS. 17 and 18 are screen shots of the application of
`FIGS. 14-16 illustrating flagging of automatically approved
`cardholder-not-present transactions in accordance with
`aspects of the present disclosure; and
`FIG. 19 is a screen shot of the application of FIGS. 14-18
`illustrating line item details of a transaction in accordance
`with aspects of the present disclosure.
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`DETAILED DESCRIPTION OF SPECIFIC
`EMBODIMENTS
`
`One or more specific embodiments of the present invention
`will be described below. In an effort to provide a concise
`description of these embodiments, not all features of an actual
`implementation are described in the specification. It should
`be appreciated that in the development of any such actual
`implementation, as in any engineering or design project,
`numerous implementation-specific decisions must be made
`to achieve the developers specific goals, such as compliance
`with system-related and business-related constraints, which
`may vary from one implementation to another. Moreover, it
`should be appreciated that such a development effort might be
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`US 8,140,418 B1
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`The electronic device 10 may further have a user interface
`20. The user interface 20 may include, for example, indicator
`lights, user inputs, and/or a graphical user interface (GUI) on
`the display 18. In practice, the user interface 20 may operate
`via the CPU 12, using memory from the main memory 14 and
`long-term storage in the nonvolatile storage 16. In an embodi
`ment lacking the display 18, indicator lights, Sound devices,
`buttons, and other various input/output (I/O) devices may
`allow a user to interface with the electronic device 10. In an
`embodiment having a GUI, the user interface 20 may provide
`interaction with interface elements on the display 18 via
`certain user input structures, user input peripherals such as a
`keyboard or mouse, or a touch sensitive implementation of
`the display 18.
`At a given time, one or more applications may be open and
`accessible to a user via the user interface 20 and/or displayed
`on the display 18 of the electronic device 10. The applications
`may run on the CPU 12 in conjunction with the main memory
`14, the nonvolatile storage 16, the display 18, and the user
`interface 20. Various data may be associated with each open
`application.
`A user may employ the electronic device 10 to review and
`approve or cancel cardholder-not-present transactions. As
`Such, it should be appreciated that the instructions for carry
`ing out Such techniques may represent a standalone applica
`tion, a function of the operating system of the electronic
`device 10, or a function of the hardware of the CPU 12, the
`main memory 14, the nonvolatile storage 16, or other hard
`ware of the electronic device 10.
`In certain embodiments, the electronic device 10 may
`include location sensing circuitry 22. The location sensing
`circuitry 22 may represent global positioning system (GPS)
`circuitry, but may also represent one or more algorithms and
`databases, stored in the nonvolatile storage 16 or main
`memory 14 and executed by the CPU 12, which may be used
`to infer location based on various observed factors. For
`example, the location sensing circuitry 22 may include an
`algorithm and database used to approximate geographic loca
`tion based on the detection of local wireless networks (e.g.,
`802.11x, otherwise known as Wi-Fi) or nearby cellular phone
`towers. The location sensing circuitry 22 may be used by the
`electronic device 10 to determine a user's location during an
`event; the location during the event may then affect and/or
`determine the information displayed on the electronic device
`10.
`With continued reference to FIG. 1, the electronic device
`10 may also include a wired input/output (I/O) interface 24
`for a wired interconnection between one electronic device 10
`and another electronic device 10. The wired I/O interface 24
`may be, for example, a universal serial bus (USB) port or an
`IEEE 1394 port (e.g., FireWireR), available from Apple Inc.),
`but may also represent a proprietary connection. Addition
`ally, the wired I/O interface 24 may permit a connection to
`peripheral user interface devices, such as a keyboard or a
`OUS.
`One or more network interfaces 26 may provide additional
`connectivity for the electronic device 10. The network inter
`faces 26 may include, for example, one or more network
`interface cards (NIC) or a network controller. In certain
`embodiments, the network interface 26 may include a per
`sonal area network (PAN) interface 28. The PAN interface 28
`may provide capabilities to network with, for example, a
`Bluetooth R) network, an IEEE 802.15.4 (e.g., ZigBee) net
`work, or an ultra wideband (UWB) network. As should be
`appreciated, the networks accessed by the PAN interface 28
`may, but do not necessarily, represent low power, low band
`width, or close range wireless connections. The PAN inter
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`face 28 may permit one electronic device 10 to connect to
`another local electronic device 10 via an ad-hoc or peer-to
`peer connection. However, the connection may be disrupted if
`the separation between the two electronic devices 10 exceeds
`the range of the PAN interface 28.
`The network interface 26 may also include a local area
`network (LAN) interface 30. The LAN interface 30 may be,
`for example an interface to a wired Ethernet-based network or
`an interface to a wireless LAN, such as a Wi-Fi network. The
`range of the LAN interface 30 may generally exceed the range
`available via the PAN interface 28. Additionally, in many
`cases, a connection between two electronic devices 10 via the
`LAN interface 30 may involve communication through a
`network router or other intermediary device.
`Additionally, for some embodiments of the electronic
`device 10, the network interfaces 26 may include the capa
`bility to connect directly to a wide area network (WAN) via a
`WAN interface 32. The WAN interface 32 may permit a
`connection to a cellular data network, such as the Enhanced
`Data rates for GSM Evolution (EDGE) network, a 3G net
`work, or another cellular network. When connected via the
`WAN interface 32, the electronic device 10 may remain con
`nected to the Internet and, in Some embodiments, to another
`electronic device 10, despite changes in location that might
`otherwise disrupt connectivity via the PAN interface 28 or the
`LAN interface 30. As will be discussed below, the wired I/O
`interface 24 and the network interfaces 26 may represent
`high-bandwidth communication channels for transferring
`user data using the simplified data transfer techniques dis
`cussed herein.
`Certain embodiments of the electronic device 10 may also
`include a near field communication (NFC) interface 34. The
`NFC interface 34 may allow for extremely close range com
`munication at relatively low data rates (e.g., 424 kb/s), and
`may comply with such standards as ISO/IEC 18092, ECMA
`340, ISO/IEC 21481, ECMA-352, ISO 14443, and/or ISO
`15693. The NFC interface 34 may have a range of approxi
`mately 2-4 cm. The close range communication with the NFC
`interface 34 may take place via magnetic field induction,
`allowing the NFC interface 34 to communicate with other
`NFC interfaces 34 or to retrieve information from tags having
`radio frequency identification (RFID) circuitry. As described
`below, the NFC interface 34 may enable initiation and/or
`facilitation of data transfer of from one electronic device 10 to
`another electronic device 10.
`The electronic device 10 of FIG. 1 may also include a
`camera 36. With the camera 36, the electronic device 10 may
`obtain digital images and/or videos. In combination with
`optical character recognition (OCR) software, barcode-read
`ing software, or QR-code-reading software running on the
`electronic device 10, the camera 36 may be used to input data
`from printed materials having text or barcode information.
`In addition, in certain embodiments of the electronic
`device 10, one or more accelerometers 38 may be included
`which sense the movement and/or orientation of the elec
`tronic device 10. The accelerometers 38 may provide input or
`feedback regarding the position of the electronic device 10 to
`certain applications running on the CPU 12. By way of
`example, the accelerometers 38 may include a 3-axis accel
`erometer from STMicroelectronics.
`FIGS. 2-3 illustrate various specific embodiments of the
`electronic device 10 of FIG. 1. For example, the electronic
`device 10 of FIG. 1 may be a handheld device 40, as illus
`trated in FIG. 2. The exemplary handheld device 40 may be a
`portable phone and/or a portable media player, such as an
`iPhone(R) or an iPodR available from Apple Inc.
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`7
`The handheld device 40 may have an enclosure 42 of
`plastic, metal, composite materials, or other Suitable materi
`als in any combination. The enclosure 42 may protect the
`interior components of the handheld device 40 from physical
`damage and electromagnetic interference (EMI). Addition
`ally, the enclosure 42 may allow certain frequencies of elec
`tromagnetic radiation to pass to and/or from wireless com
`munication circuitry within the handheld device 40 to
`facilitate wireless communication.
`The display 18 of the handheld device 40 may include the
`user interface 20 in the form of a GUI, which may have a
`number of individual icons representing applications that
`may be activated. The user interface 20 on the display 18 of
`the handheld device 40 may also include certain status indi
`cator icons 46, which may indicate the status of various com
`15
`ponents of the handheld device 40. For example, the status
`indicatoricons may include a cellular reception meter, an icon
`to indicate when the PAN interface 28 is active (e.g., when a
`Bluetooth R) network is in use), or a battery life meter.
`In some embodiments, a transaction management applica
`tion icon 44 may be selectable by a user. For example, the
`display 18 may serve as a touch-sensitive input device, and
`icons may be selected by touch. Here, the transaction man
`agement application icon 44 is designated as “eWallet” to
`indicate to a user that selection of the icon 44 will allow the
`user to review and/or manage financial transactions. Such as
`cardholder-not-present transactions. When the transaction
`management application icon 44 is selected, the transaction
`management application may open, as described further
`below. The transaction management application may enable a
`30
`user to review and authorize or decline in-progress and com
`pleted cardholder-not-present transactions.
`The handheld device 40 may connect to another electronic
`device 10, such as a computer, through the wired I/O interface
`24. For example, the wired I/O interface 24 may be a propri
`etary connection for coupling the handheld device 40 to
`another electronic device 10 via USB or FireWire(R). Once
`connected, the devices 10 may synchronize and/or transfer
`certain data, Such as card information and/or transactions, in
`accordance with techniques dis