A couple of months ago I received a letter from a performance ticket outlet letting me know that they incurred a data breach and that my personal information may have been compromised. The personal information not only included my name and basic contact details, but also my credit card information. Due to this data breach, they recommended that I remain very vigilant and take steps to protect myself against identity theft and fraud. One of the items they encouraged me to do was to contact Equifax, Experian, and TransUnion and register for their Single Bureau Credit Monitoring, Single Bureau Credit Report, and Single Bureau Credit Score services, all provided at no charge.
After reading the letter, I sat down and said to myself, “Dear God, why me? What did I do to deserve this?” Here I am trying to follow the multitude of rules in our society, keeping my nose clean, and yet here’s another issue for me to worry about. Perhaps many of you have experienced this same situation.
What’s more, now that AI is becoming front and center in all aspects of our lives, being guarded against credit card and identify theft might now be a daily chore. Fortunately, however, as much as fraudsters are using AI to take what’s not theirs, credit card companies and financial institutions are using AI to fight right back.
Here’s a quick overview of how AI is being used to aggressively counter the efforts of criminals to undermine society with their illicit activities:
Fraud Detection and Prevention
- Machine Learning Models: Financial institutions use machine learning models to analyze vast amounts of transaction data in real-time. These models can identify patterns and anomalies indicative of fraudulent activity, improving the accuracy and speed of fraud detection.
- Behavioral Analysis: AI systems can create profiles based on the spending behavior of individuals. When a transaction deviates significantly from a user’s typical behavior, it can trigger alerts for further investigation.
- Fraud Scoring: AI can assign risk scores to transactions based on various factors, such as transaction amount, location, and merchant type. Higher scores can prompt additional verification steps to prevent fraud.
- Natural Language Processing (NLP): NLP helps in monitoring communications, such as emails and text messages, for phishing attempts. AI can analyze the language used to identify potential scams before they reach the user.
Technological Advancements
- Biometrics: AI is improving biometric authentication methods, such as facial recognition and fingerprint scanning, making it harder for fraudsters to use stolen cards or identities.
- Real-time Analysis: The ability of AI to process and analyze data in real-time allows for immediate action against fraudulent activities, such as blocking a transaction or notifying the cardholder.
- Collaboration and Data Sharing: AI facilitates better collaboration between financial institutions by enabling the sharing of anonymized fraud data. This helps in improving the overall detection systems and making them more robust against evolving threats.
In short, as the evolution of AI technology continues to advance in the fight against credit card and financial crimes, I’m hopeful that eventually I won’t be getting letters informing me that my personal and credit card information has been compromised.
Nancy Seiverd
CMI Credit Mediators, Inc.
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Image by freepik.com.
Source: Mastercard