Financial sectors are much prone to fraud than any other industry. This is not so easy to contain as in the case of money laundering. Various online platforms have used the services of institutions like TransUnion, an American credit reporting agency that developed counterfeit analytics to detect and stop frauds. Counterfeit analytics, which is an AI-driven technology use principles that have been programmed into it for making decisions and to determine whether an act of fraud has been carried out. These systems are extremely efficient and accurate thereby enabling businesses to focus more on their clients and enhance the customer experience.
The possibility of various frauds in the financial sector are:
- Credit card fraud: Credit card frauds are becoming increasingly popular as it is very easy to get hold of the credit card and financial data. The hackers can easily access them.
- Chargeback abuse: This happens when the holder of a credit card account will contact the financial institutions for an unauthorized payment to an online casino. The financial institutions will revert the charges to the casino. These chargebacks are detrimental to their relationship with their financial institutions.
- Chip Dumping: It is the practice of players in an online casino game loose to another player intentionally and purposefully so that the money they represent is transferred to the other player. This person will then deposit the money into a legit account so that they won’t look suspicious.
Thus fraud analytics is the best way to prevent such illegal transactions. This technology is used concurrently with human interactions. Fraud analytics is based on the analysis of irregularities, patterns, and inconsistencies which enable an organization to detect the possibility of a threat and stop before it turns out to be a major issue. This also offers a variety of other benefits like identification of unknown patterns, improving performance in the workplace.
Companies might have adequate resources to develop software to detect fraud and criminal activities, but the brainpower some criminals possess surpasses what an organization is capable of. So there comes the relevance of fraud analytics and effective fraud management systems for organizations.