Preventing E-Commerce Fraud with AI Solutions

In the context of many potential risks of cyber security and fraud in online transactions that directly threaten personal information and user rights, artificial intelligence (AI) has emerged as a potential solution, contributing to protecting consumers and promoting the sustainable development of the e-commerce market.

A representative of the Department of E-commerce and Digital Economy ( Ministry of Industry and Trade ) said: The increase in cyber attacks tends to target e-commerce businesses. According to the Vietnam National Cyber Security Technology Company (NCS), in 2023 there were 13,900 cyber attacks targeting organizations in Vietnam. Thus, an average of 1,160 cases occurred each month, an increase of 9.5% compared to 2022. Attacks often target customer data, payment information, and even the network infrastructure of e-commerce businesses.

Regarding fraud in e-commerce, common forms include payment fraud, sending goods that do not match the description, and using fake information to make purchases. The General Department of Market Management (Ministry of Industry and Trade) predicts that in the next 2 to 3 years, the rate of commercial fraud in e-commerce will account for about 50 - 60% compared to the total form of commercial fraud in general. This is a worrying number, showing the seriousness of the fraud problem in the e-commerce market in Vietnam.

According to the representative of the Department of E-commerce and Digital Economy , not only Vietnam, the issue of network security, anti-fraud, and user information security is also a headache for many countries in the world. A report by Cybersecurity Venture - the world's leading research organization on the global network economy also pointed out that losses due to cybercrime have reached 8 trillion USD in 2023 worldwide - equivalent to more than 250,000 USD per second. It is forecasted that by 2025, annual losses will increase to 10.5 trillion USD.

Fraud, scams and data loss in e-commerce not only cause economic damage but also lose customer confidence, affecting the reputation and sales of businesses. Therefore, strengthening security controls in e-commerce transactions is urgent. Among them, the use of technology, specifically AI applications, can detect and prevent fraudulent behavior, as well as help secure user information in e-commerce transactions thanks to its powerful capabilities.

In particular, AI is used to identify and verify the identity of buyers when they make online transactions, including checking fingerprints, facial recognition, voice recognition, etc. to help prevent information theft and account fraud. Identification technology helps ensure that the person making the transaction is the legitimate owner of the account.

At the same time, AI systems can also automatically detect and prevent fraudulent behavior, including unauthorized use of user login information or credit cards. This not only protects the buyer but also protects the interests of the business.

Furthermore, AI can track and analyze user behavior on a website, as well as data from transaction history, to detect unusual behavior that could be a sign of fraud. For example, a user who changes their shipping address multiple times in a short period of time, or inconsistent purchasing patterns, could also be a sign of e-commerce fraud.

Additionally, AI can analyze millions of transactions to find unusual patterns of behavior, helping to prevent fraud and protect both consumers and businesses. If an account makes many large transactions in a short period of time or uses many different credit cards, it is a warning sign of possible fraud.

Machine learning and deep learning algorithms provide powerful tools for data processing and analysis, which are applied to build fraud prediction models, so that AI can automatically detect and block fraudulent transactions effectively. This is especially important in the e-commerce environment, where financial fraud and scams can cause huge losses.

PayPal is a prime example of using AI systems to analyze billions of transactions to detect and prevent financial fraud. This system helps reduce the risk of fraud while optimizing the payment experience for users. In addition, AI helps automate the process of reviewing products and content posted on e-commerce platforms. At the same time, AI can help detect counterfeit goods by analyzing and comparing product images, descriptions, and prices with data of genuine goods. This process helps protect brands and consumers from counterfeit goods.

The representative of the Department of E-commerce and Digital Economy emphasized: Effective use of AI can help e-commerce businesses enhance security, minimize fraud risks and provide a safer shopping experience for customers. However, due to many limitations in technology infrastructure, human resources and costs, to be effective, it is still necessary to combine traditional security measures and smart use of artificial intelligence.

According to VNA/Tin Tuc Newspaper

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