The promise of getting rich via cryptocurrency investment is plastered all over social media. This has resulted in many people being caught up in the dream and losing out to scams. An estimated 40% of scam transactions exit directly from a bank account to a crypto exchange. According to Feedzai’s recent report, The State of Global Anti Money Laundering (AML) Compliance Report 2023, the monitoring of cryptocurrency effectively is still one of the biggest challenges for financial institutions.

As a result of this, Feedzai and Mastercard have combined technologies to increase crypto fraud protection for millions of consumers. Addressing the need to implement effective AML solutions, Feedzai and Mastercard will collaborate to integrate Mastercard’s crypto intelligence solution, Ciphertrace Armada into Feedzai’s unique RiskOps platform. RiskOps analyses transaction data totalling over $1.7trn annually and offers a comprehensive suite of AI-based solutions designed to stop fraud and financial crime at the source. This allows banks to be alerted in nanoseconds when a transaction appears fraudulent. 

Identifying and preventing fraudulent crypto exchanges before they occur

Ciphertrace Armada allows banks, crypto exchanges, wallets, crypto ATMS and other Virtual Asset Service Providers (VASPs) to better assess the fraud risk in digital asset transactions. In pairing these technologies together, Feedzai’s customers, who collectively protect over 900 million consumers globally, will now be able to identify and prevent transactions involving fraudulent crypto exchanges before they occur.

The partnership comes just months after Mastercard announced its new solution that helps banks identify scams in account-to-account payments. Using AI, Mastercard Consumer Fraud Risk enables banks to intervene in real-time and to stop payment before funds leave a victim’s account. The combined intelligence means that financial institutions can stop transactions involving high-risk and potentially fraudulent crypto exchanges in real-time, alerting the customer to the risk before the money leaves their account.

Nuno Sebastião, CEO of Feedzai commented: “Mastercard’s commitment to protecting its global customer base from fraud aligns perfectly with Feedzai’s mission. Criminals use crypto as part of their scam strategies, with the scam proceeds often ending up being funnelled to an unauthorised or otherwise risky crypto exchange. It also continues to remain a challenge for AML professionals as criminals become ever more sophisticated and money laundering techniques advance. This global partnership will further empower banks to protect their customers against the risks associated with crypto and instill further trust in the ecosystem.” 

Ajay Bhalla, president of Cyber and Intelligence at Mastercard said: “This is an exciting step in our journey to secure the digital ecosystem. We’re providing financial institutions with the insights they need to be able to prevent transactions involving fraudulent crypto exchanges. We are delighted that, through this new partnership, we are able to go further, by helping to stop fraud and payments to scams before they take place, giving customers more choice, security and, most importantly, reinforcing trust.”

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