Online fraud is a phenomenon increasingly present in our daily lives through the massive use of online purchases. There are several steps to discover and stop these fraudsters.
Online fraud can happen at any stage of the user journey, not just at checkout. Unlike real customers who spend time browsing or looking for what they need, bots, which are automatic software agents that interact with servers, and fraudsters work quickly and directly to carry out their fraudulent activity. Monitoring and early detection help reduce the number of fraud incidents and the overall cost of fraud.
A multitude of different frauds
Be aware that there are many types of online fraud that occur at different stages of the user lifecycle, including account takeover (ATO) fraud, account creation fraud, and fraud. at the register. Bots can be used for all types of fraud, often as an initial test to see how your system responds. Because compromised accounts and fake accounts are often used multiple times, fraud detection stops more than an isolated incident.
Account takeover fraud
Account takeover (ATO) fraud can include transactional fraud and non-transactional fraud, such as stealing loyalty points. Fraudsters use compromised information obtained through hacker attacks. phishing, data breaches or purchased on the dark web to gain access to a legitimate user’s account. After initial testing of the compromised credentials, such as changing the shipping address or changing the password, the fraudster moves on to financial transactions. Personally identifiable information (PII) obtained through account takeover fraud allows fraudsters to open new accounts or take control of additional accounts in the future.
Detect online fraud
When you’re able to prevent fraud by catching fraudsters the first time they interact with your site or app, you’ll save your business and your customers a lot of trouble. Whether it’s new account, account takeover, or cash register fraud, detecting fraudulent activity before the transaction occurs limits financial and reputational damage.
Online fraud detection uses the machine learning and artificial intelligence (AI) to prevent fraudsters from creating accounts, logging in and completing transactions. Legitimate login attempts and account activity by customers, employees, and partners follow predictable patterns, while bot and hacker behavior tends to deviate from the norm.
Watch out for these scams
Online fraud detection tools are also used to monitor fraud throughout the user journey, from account creation to where and when the user accesses their account. Beginning with a user’s first interaction, online fraud monitoring uses machine learning and artificial intelligence (AI) to spot anomalies between legitimate users and fraudsters or bots. Monitoring sessions in real time rather than just focusing on transactions means that fraudulent activity is discovered before a transaction occurs.
In addition to fraud detection and monitoring, a comprehensive risk management strategy also includes fraud prevention. Any business can be a victim. Do not wait to be to monitor your fraud.