Artificial intelligence (AI) is reshaping the fraud landscape, introducing sophisticated new threats, while simultaneously presenting opportunities to combat fraud through advanced security solutions.
Scams are becoming increasingly sophisticated, with criminals using more convincing tactics and exploiting vulnerabilities in security systems, especially through generative AI and its ability to create realistic human interaction. Hyper-realistic phishing emails and websites are now being crafted with AI, mimicking the look and feel of legitimate banks. Furthermore, sophisticated voice cloning allows AI to create voice clones of bank representatives, making vishing scams more convincing and harder to detect. AI is also automating social engineering, crafting personalised messages, and adapting to user responses to manipulate victims. Additionally, it can generate fake news articles and social media posts to spread misinformation about banks or financial products.
Enumeration attacks have also become more prevalent, with AI helping robots test card BIN numbers on merchant websites to validate the existence of cards, which are then sold on the black market. The primary aim of scams and social engineering is to deceive their targets, whether to pilfer the payer’s credentials or personal information to carry out an authenticated payment by themselves (resulting in unauthorised payment transaction), or to persuade payers to take prompt, often rushed actions, such as initiating a credit transfer (resulting in authorised payment transaction, or authorised push payment fraud/scams). However, it is unmistakably this latest form of fraud, known as impersonation fraud or spoofing, that has experienced a significant surge in recent months. According to EDC, Authorised Push Payment (APP) fraud losses across Europe could be as high as EUR 2.4 billion, increasing by 20%-25% yearly.
Regulators are deeply concerned about this ever-changing threat landscape. One notable example is the European Commission’s proposed PSD3, which encompasses fresh Payment Services Regulation and updated Payment Service Directive. These enhancements would bring liability for Payment Service Providers (PSPs) and introduce reimbursement regulations for APP fraud, alongside the introduction of a Verification of Payee (VoP) scheme, aimed at IBAN/name matching verification services.
The key to combating increasingly sophisticated fraud lies in deploying equally advanced solutions. The rapid advancement of generative AI has significantly accelerated the pace of financial crime, posing a formidable challenge to human identification of fraudulent activities. Companies that fail to integrate AI into their systems and adapt to evolving threats will struggle to keep up with the speed and adaptability of fraudsters’ attacks. While nearly 50% of financial institutions acknowledge the use of AI and machine learning to detect unknown fraud cases according to GBG, many still rely on restricted data sources despite recognising the critical role of technology in this ongoing battle.
Artificial intelligence is changing the game, offering price threat detection, minimising the impact of cyberattacks, and enhancing the efficiency of cybersecurity, but it still requires access to the right data.
Worldline Digital Security Suite stands out as a robust and adaptive response to the relentless threat of fraud and identity theft, based on device intelligence.
Our solution produces various scores, each designed to fulfil a specific purpose and address a distinct type of fraud.
The prevention score is the first line of defence, an initial check that prevents potential threats from progressing further. It ensures the device used to access services meets the standards of our security policy. Checks are made, on various elements such as root/jailbreak mode, virtualisation, the potential use of harmful extensions or plugins, and others. This score helps assess the risk of tampering or malware presence on the device.
The footprint score, functioning like a digital detective, observes and records the unique characteristics of the device used and browsing habits. It easily detects identity counterfeiting attempts through unusual changes in configurations or hardware components. It can create alerts when a new device is used and can compile a blacklist of devices and behaviours associated with fraudulent activities.
The behavioural score best embodies our personalised and adaptive approach to security. It monitors how the user interacts with the device: orientation, movement, keystrokes. These behavioural data, captured non-intrusively, are essential for detecting unusual patterns that could indicate phishing attempts or, worse, a remote takeover by a cybercriminal. This score also allows for continuous validation of the user’s identity without bothering them with superfluous authentication requests, providing a seamless and secure experience.
The combination of these scores provides a comprehensive overview that ideally complements existing fraud systems based on purchasing behaviour analysis.
Unfortunately, these systems heavily depend on the country, the means of payment (card, transfer, etc), and the type of card (business, consumer, etc.). In contrast, our device intelligence scores work regardless of the use case, making it a unique fraud detection tool.
Worldline Digital Security Suite has been awarded in June 2024 by the Pay Tech Awards of the best AI tech of the Future from FinTech Future.
This editorial piece was first published in The Paypers' Fraud Prevention in Ecommerce Report 2024-2025, the ultimate source of knowledge that taps into the ever-evolving fraud realm and helps ecommerce specialists protect their businesses with the latest fraud prevention strategies.
Claire is responsible for the product management of Strong Customer Authentication & Security solutions such as Access Control Servers, Trusted Authentication, and Digital Intrusion Protection. With 10 years of experience in international business developments and bids, she has developed strong skills in understanding customers and market requirements, with a special focus on security, payments, and identity.
Worldline helps businesses of all shapes and sizes to accelerate their growth journey – quickly, simply, and securely. With advanced payments technology, local expertise and solutions customised for hundreds of markets and industries, Worldline powers the growth of over one million businesses worldwide. Worldline generated EUR 4.6 billion in revenue in 2023.
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