The Otto Group, Europe’s second largest online retailer, generates more than $13 billion in annual sales — 50% online. Much of Otto’s sales are household items and consumer electronics, goods that are desired by criminals using stolen credit cards because they can be resold for cash. Otto Group created an internal business unit in 2012 to address fraud, which amounted to 1% of sales. This amount is typical for merchants selling online. That business unit is now a stand-alone company called Risk Ident. It sells a combination of machine-learning and rules-based software that retailers c...