Machine Learning

Machine learning (ML) refers to the development of computer algorithms and statistical models to perform predictions and specific tasks without explicit instructions, rather using inferences and patterns instead. Machine learning is a subset of artificial intelligence and generally falls into two main categories: 1) supervised learning, in which the outcomes are known and labelled in training data sets and 2) unsupervised learning, in which no outcome is known and the goal is to have items self-organized into clusters based on common characteristics or features. Supervised learning uses techniques like neural networks, bayesian models, regression models, statistical models, or a combination thereof. Unsupervised learning uses techniques like k-means clustering and is often used for anomaly detection. Some computer systems have the ability to “learn” or make progressive improvements on a task based on algorithms and subsequent outcomes. As an example, machine learning in fraud prevention allows algorithms to make immediate decisions on new transaction decisions, but over time "learn' from the outcomes of the purchases and from that new data, self-correct to make increasingly accurate predictions going forward. The fastest and most reliable path towards the learning component relies on analysts’ insights, assisted by machine-learned predictions, to make well-informed decisions.

Mail Fraud and Wire Faud

Mail fraud and wire fraud are federal crimes in the United States that involve mailing or electronically transmitting something associated with fraud. Jurisdiction is claimed by the federal government if the illegal activity crosses interstate or international borders.

Mail Order Telephone Order (MOTO)

Mail Order Telephone Order (MOTO) is a type of card-not-present (CNP) transaction in which services are paid and delivered via telephone, mail, fax, or internet communication. With the introduction of chip technology on most cards, there has been reduced fraud in “card present” transactions, but a corresponding increase in fraud in CNP transactions. The word stands for “mail order telephone order,” although those types of financial transactions are increasingly rare. MOTO has, therefore, become synonymous with any financial transaction where the entity taking payment does not physically see the card used to make the purchase.

Malware

Malware is software that is intentionally designed to cause damage to a computer, client, server or the network of a computer. Hostile, intrusive, and intentionally nasty, malware seeks to invade, damage, or disable computers, often by taking partial control over a device’s operations.

Man-In-The-Browser

A man-in-the-browser is a type of online threat, where a hacker uses a trojan horse virus to gain access to your computer. From there, the hacker manipulates the content you see within your web browser, which can allow them to record your personal information and passwords, as well as manipulate your transactions so that the money you think you are spending on an online product actually goes to the hacker, without anything looking any different from normal on that webpage.

Man-In-The-Middle

Man-in-the-middle (MITM) is an attack where the attacker secretly relays and possibly alters the communications between two parties who believe they are directly communicating with each other.

Manpower Direct and Indirect Costs

Manpower Direct Costs include wages for the employees that produce a product, including workers on an assembly line, while indirect costs are associated with support labor, such as employees who maintain factory equipment.

Manual Review

Manual review is a technique that can be performed in-house or may be outsourced to or managed by a third party vendor. In either case, staff members perform manual checks on orders to determine the authenticity of an identity and transaction to establish which orders are fraudulent.

Manual Submission

Manual submission describes when somebody adds URLs to a search engine manually, filling out the form fields individually. This differs from automatic submissions, which involve filling out information only one time; the necessary information is then used by a software program to submit to many search engines.

Marketplace

A marketplace is the real, virtual or metaphorical space in which a market operates. The term is also used in the trademark law context to denote the actual consumer environment, i.e. the 'real world' in which goods and services are provided and consumed.

Marketplace Fraud

What is Marketplace Fraud?

Marketplace fraud is the illegal practice of making false or misleading claims through a company. This includes exaggerating the qualities of a product or service in advertising, selling imitations as the genuine article, or hiding negative aspects or side effects. False advertising is a type of the marketplace fraud.

An online marketplace creates a streamlined process for buyers and sellers to find one another. The first wave
of digital marketplaces came about with eBay’s launch in 1995. More product-focused marketplaces like these followed swiftly, from Amazon to WALMART's Jet.com.

Since then, online marketplaces have evolved to combine products and services. Whether it’s to buy something, rent a living space or get a ride, these marketplaces have spanned across various market segments from food to crowdfunding.

Types of Marketplace Fraud

1. Fake Profile or Product Fraud - Common on marketplaces like Wish.com or Alibaba, a fraudulent seller copies the profile of a legitimate seller in order to deceive victims and turn a profit. This is damaging to the original sellers as well, as business is stolen. A potential customer is lost, and in some cases may never even receive a product.
2. False Advertising - Misleading representation of goods or services through false or fraudulent claims or statements.
3. Fake Buyer and Seller Closed Loop Account Fraud - A fraudster creates multiple fake buyer and seller accounts created. The fake buyers pay the fake seller for nonexistent items or services using stolen credit cards.

How to Stop Marketplace Fraud

Stopping marketplace fraud can be difficult for businesses. Keeping an important eye on marketplaces with similar products is vital to deter product fraud. Additionally, keeping an eye on your own customers, and those who purchase with fraudulent information, might indicate further resellers. Keeping tabs not only on public marketplaces, but the needs of those who are trying to manipulate the deep web, is another practice that will keep you ahead on the latest fraud trends.

The best way you can improve your fraud prevention on either sides of the market is by relying on ecommerce fraud prevention software. Machine learning fraud detection leverages billions of consortium transactions and outcomes to detect fraud.  This is done at every stage of the customer life cycle, in real-time to detect unusual transaction patterns. AI crawlers that scan the deep and dark web keep the system up to date without the need to constantly set new rules in the software. 

Fraud.net addresses these problems with a comprehensive and flexible fraud prevention platform, including AI / Deep Learning models, consortium fraud data, highly customizable case management and advanced analytics.

Learn More

• Visit the Ecommerce Industry page on our website
• Speak with a Fraud Prevention Specialist

Medical Fraud

Medical fraud is a type of white-collar crime that involves the filing of dishonest health care claims in order to turn a profit. Health care fraud influences insurance rates every day, causing premiums individuals pay to rise to cover the insurance companies’ losses.

Medical Identity Theft

Medical identity theft occurs when somebody illegally accesses and uses a patient's personally identifiable information (PII) to obtain medical treatment, services or goods. The stolen information may be used to open credit card accounts or obtain medical services such as treatment at an emergency medical crisis location.

Merchant Account

A merchant account is a type of bank account that allows businesses to accept payments made by debit or credit cards.

Merchant Account Provider

Merchant account providers give businesses the opportunity to accept debit and credit cards for the payment of goods and services. This can be conducted face-to-face, over the phone, or even over the Internet.

Merchant Chargeback Insurance Provider

MFA (Multi-Factor Authentication)

What is Multi-Factor Authentication (MFA)?

MFA or Multi-Factor Authentication, also called Step-Up Authentication, is an approach to security authentication, in which the user of a system provides more than one form of verification to prove their identity and be granted access. Multi-factor authentication is so named because it leverages a combination of two or more factors of authentication. In the field of cybersecurity, the three major factors of authentication and verification are: 1) something a user knows (such as a password or the answer to a question), 2) something the user has (such as a smart card, a mobile phone or a security token), and something the user is (such as a unique biometric marker like a fingerprint).

Why is MFA Important?

Reducing risks is key for businesses organizations, no matter the size. As further organizations cultivate a digital workspace, credential harvesting is increasing.  According to a report from Verizon, for example, over 80 percent of hacking-related breaches are caused by stolen or weak passwords.  With this in mind, MFA becomes essential.

Fraud.net offers Multi-Factor Authentication as a feature within our Fraud Prevention Suite.   

Here's how it works:

Fraud.net's multi-factor authentication feature gives fraud analysts the ability to send a verification text message to the phone number of a transaction. The purpose of this is to authenticate that the phone number within the transaction is owned by the person who actually placed the transaction. A Yes/No question will be sent to a phone and then based on the response the transaction, it can be auto-cancelled, auto-approved or sent to a queue for further review.

1. When a fraud analyst is reviewing a transaction, they can select the option to authenticate the transaction (Send MFA) from the dropdown menu in the top right corner:

2.  The fraud analyst will then confirm that they would like that message sent:

3. The admin, from the business profile page, can manage what the message says and what action occurs based on the reply. The admin can also manage what happens when no reply is received and the time frame for the reply. The default question reads as "$business name$ here. We received a transaction from $firstname$ $lastname$ for $amount$ on $orderdate$. Was this you?"
Reply Yes or No"

4. The transaction remains in a pending authentication queue until there is a response or it expires.

Interested in learning more or enabling Multi-Factor Authentication within your Fraud Prevention Solution?

Speak with a Specialist Now

Misrepresentation

Misrepresentation is a concept of English law, which describes when a party uses misleading statements or facts in negotiations to induce the other party to take certain actions.

Mobile

A "mobile" is a term used for phones, stemming from the term "mobile phones", which differs from their predecessor, wired or immobile phones. A mobile phone is a portable device whose primary use is to "call" other phones, allowing for a conversation to be had from pretty much any two places in the world between these two devices.

Mobile Device Analysis

Mobile device analysis is a branch of digital analysis that refers to the recovery of digital evidence or data from different mobile devices under the analysis of a sound condition. Mobile devices are used to save different types of personal information such as contacts, notes, calendars, and to communicate with others.

Mobile Phone Fraud

Mobile phone fraud is simply any fraud that involves the use of mobile phones. One type of this fraud is call-forwarding fraud, where a fraudster tricks a victim into mistakenly forwarding their phone calls to another number.

Money Laundering

What is Money Laundering?

Money laundering is the process of transforming "dirty" money derived from criminal activities, such as drug trafficking, corruption, fraud, or illegal arms sales, into "clean" or legitimate money. The primary objective is to obscure the trail of illicit funds, making it difficult for law enforcement agencies and financial institutions to trace the money back to its illegal origins. This process involves several stages: placement, layering, and integration.

Here are some of the leading statistics on money laundering:

• Approximately $300 billion is laundered through the United States each year.
• Over 200,000 cases of money laundering are reported to the authorities in the UK annually
• Money laundering takes up about 1.2% of the European Union’s entire GDP, which is between EUR 715 billion and 1.87 trillion each year

Common Types of Money Laundering and Distinctions from Embezzlement

Money laundering can take various forms, including structuring deposits, using shell companies, trade-based laundering, real estate investments, and even digital currency transactions. Unlike embezzlement, which involves the misappropriation of funds by individuals entrusted with them, money laundering focuses on the process of making illegal proceeds appear legal. Embezzlement typically involves theft or misappropriation of funds for personal gain without the intent of disguising its origin, whereas money laundering aims to legitimize the illicit funds.

Solutions for Money Laundering

A multi-faceted approach is necessary to combat money laundering effectively:

• Strengthen Regulatory Frameworks: Governments must enact robust laws and regulations to prevent and detect money laundering. Enhanced due diligence, transparency in financial transactions, and beneficial ownership disclosure requirements are critical components.
• Collaboration and Information Sharing: Collaboration among financial institutions, regulatory bodies, and law enforcement agencies is crucial. Sharing information and intelligence can aid in identifying suspicious activities and patterns.
• Technology and Data Analytics: Implementing advanced technologies such as artificial intelligence, machine learning, and data analytics can enhance the detection capabilities of financial institutions, enabling them to identify and flag suspicious transactions more efficiently.
• Customer Due Diligence: Conducting thorough customer due diligence, including Know Your Customer (KYC) procedures, helps institutions verify the identity of clients and assess the legitimacy of their transactions.
• Anti Money Laundering (AML) Measures: Anti-money laundering measures encompass strategies, policies, and procedures aimed at preventing, detecting, and reporting instances of money laundering. AML compliance involves ongoing monitoring, risk assessment, staff training, and the implementation of robust internal controls within financial institutions to ensure regulatory compliance and mitigate the risks associated with money laundering.

Defeating Financial Crimes with Fraud.net's Advanced Solutions for Money Laundering

Fraud.net offers innovative solutions that leverage advanced technologies to combat financial crimes, including money laundering. Our platform integrates AI-powered fraud detection, data analytics, and real-time monitoring to identify and prevent suspicious activities.

To learn more about Fraud.net's specific solutions for money laundering and to request a demonstration, book a meeting with one of our solutions consultants today.

Money Mules

People who receive money into their account and transfer it elsewhere for a fee. It is usually done for money laundering, which makes money mules complicit in illegal crimes. 

Like with address drop scams, money mules are often unaware they are helping criminals. They are commonly found via fake job posts, and hired under false pretenses, for instance forwarding money to a charity in a foreign country.

Monitoring

The term monitoring refers to the observing and checking of the progress or quality of something over a period of time. Monitoring services generally ensure the security and authenticity of something over time.

Mortgage fraud

Mortgage fraud is a crime in which the fraudster omits information on an application for a mortgage loan to obtain to greater loan than they would likely normally be eligible to recieve.

Mousetrapping

Mousetrapping is a technique used by websites to keep its visitors on the website for longer, and also to force visitors to engage with their website. It may occur from a website launching pop-up ads to delay the user from exiting the page.

Multichannel Merchanting

Multichannel merchanting describes the process of trying to sell products to both current and potential users through a variety of channels.