• Latest
aws fraud detector

Amazon Enters the eCommerce Fraud Detection Industry

December 27, 2019
Moving identity authentication earlier in customer flow is top of mind at MRC Vegas 2023:

Moving identity authentication earlier in customer flow is top of mind at MRC Vegas 2023:

March 28, 2023
How to Strengthen Your Small Business’s Defenses Against Identity Theft

How to Strengthen Your Small Business’s Defenses Against Identity Theft

March 23, 2023
How Companies Can Avoid Zero-Party Data Fraud

How Companies Can Avoid Zero-Party Data Fraud

March 13, 2023
New Podcast Episode: Walls of Thieving Cellphones with Nethone

New Podcast: How to Stop Return Policy Abuse Fraud (Pt. 2)

February 22, 2023
Germany’s Fraud Prevention Firm Hawk AI to Focus on Global Expansion with $17M Series B

Germany’s Fraud Prevention Firm Hawk AI to Focus on Global Expansion with $17M Series B

February 15, 2023
Merchant Fraud Journal Releases Biggest Annual Fraud Trends Report Yet with Insights from 16 Leading Payment and Fraud Solutions

Merchant Fraud Journal Releases Biggest Annual Fraud Trends Report Yet with Insights from 16 Leading Payment and Fraud Solutions

February 7, 2023
Curbing emerging fraud types with network intelligence and data enrichment

Curbing emerging fraud types with network intelligence and data enrichment

January 31, 2023
Policy Abuse Fraud: What Is It and How to Protect Against It

nSure.ai Delivers Growth to Digital Commerce Leaders and Boosts YoY Revenue by 280%

January 25, 2023
Fraugster and Refurbed partner to increase approval rates and reduce fraud for refurbished electronics marketplace

Sift Appoints Former Ping Identity COO Kris Nagel as CEO

January 20, 2023
Veridos Announces Innovatrics as Strategic Partner for Advanced DNA ID Verification

Veridos Announces Innovatrics as Strategic Partner for Advanced DNA ID Verification

January 19, 2023
New Podcast Episode: Walls of Thieving Cellphones with Nethone

New Podcast: How to Stop Return Policy Abuse Fraud

January 10, 2023
How to Write a Strong Chargeback Policy: Tips to Help You Protect Your Business

How to Write a Strong Chargeback Policy: Tips to Help You Protect Your Business

January 6, 2023
  • Contribute
  • Contact Us
  • About
  • Join Us
  • Advertise
Wednesday, March 29, 2023
Merchant Fraud Journal
  • Home
  • Articles
    • Chargebacks
    • Fraud Prevention
    • Influencer Insights
  • Resources
    • Recorded Webinars
    • Podcasts
    • Vendor Directory
    • eCommerce Fraud Reports
    • Training and Certifications
    • Jobs Board
    • Associations and Non-Profits
  • News
No Result
View All Result
  • Home
  • Articles
    • Chargebacks
    • Fraud Prevention
    • Influencer Insights
  • Resources
    • Recorded Webinars
    • Podcasts
    • Vendor Directory
    • eCommerce Fraud Reports
    • Training and Certifications
    • Jobs Board
    • Associations and Non-Profits
  • News
No Result
View All Result
Merchant Fraud Journal
No Result
View All Result

Amazon Enters the eCommerce Fraud Detection Industry

by Dan
December 27, 2019
in Articles
aws fraud detector

Earlier last month Amazon sent shockwaves in the fraud prevention industry when they announced the release of the Machine Learning based Fraud Detection AWS Service. Amazon Web Services (AWS) is Amazon’s Cloud Infrastructure and is widely used by many of the largest internet companies such as Netflix, Slack, Adobe and even NASA. It’s by far the largest cloud infrastructure services and one of Amazon’s crown jewels in terms of profitability. 

When it comes to eCommerce fraud prevention Amazon is also a leader in technology and innovation. Simply given the sheer volume of ecommerce transactions that Amazon processes each year – just to put things in perspective, Amazon’s eCommerce revenue was $203 Billion in 2018 alone – being at the forefront of fraud detection technology isn’t an option it’s a must. Even a 0.5% reduction in fraudulent transactions will amount to more than a billion dollars worth of revenue. 

As such it was interesting to see Amazon announce the availability of machine learning based fraud detection service architecture for AWS. It’s unclear if the target audience of this service are merchants who are already using AWS, third party developers or payment processors as there are no use-case examples on the AWS website yet and the service seems to be in ‘Preview Mode’ for now. 

What we do know is that users need to provide source data such as emails, IP addresses and other historical transaction and account registration data, along with signals which indicate the fraudulent transactions and which are legitimate transactions. Amazon uses this data against its algorithms — along with fraud algorithms developed on the consumer business of Amazon’s business — to train customized models that recognize things like potentially malicious domains and IP address formation. After the model is trained, users can create, view, and update rules to enable actions based on model predictions. In more technical terms The Fraud Detection AWS Service page overview deck states:

“Fraud Detection Using Machine Learning enables you to execute automated transaction processing on an example dataset or your own dataset. The included ML model detects potentially fraudulent activity and flags that activity for review. The diagram below presents the architecture you can automatically deploy using the solution’s implementation guide and accompanying AWS CloudFormation template.”

*Source: AWS

The Fraud Detector Services lets users introduce additional rules based on risk tolerances. For example, they can set up a customer account registration workflow to require additional email and phone verification steps only for registrations that display high-risk characteristics. Furthermore, Fraud Detector can flag accounts that are more likely to abuse ‘try before you buy’ programs and flag suspicious online payment transactions before orders are processed and fulfilled.

It’s all exposed through a private endpoint API, which can be incorporated into services and apps on the client side. Amazon claims that Fraud Detector’s machine learning models identify up to 80% more potential bad actors than traditional methods, on average.

Impact on the eCommerce Fraud Prevention Industry 

So should dedicated fraud solutions be concerned with Amazon’s foray into this space? In my opinion most likely not. Many merchants are already weary of Amazon as it is. After all Amazon accounts for almost 50% of all US based eCommerce transactions and using Amazon’s infrastructure to process sensitive transactional data makes it a tough pill to swallow. Some merchants such as Wal-Mart have officially stated that they will flat out refuse to work with any vendors who use AWS based architecture for their solution. 

Amazon’s fraud solution however may be attractive for midsize niche merchants already using AWS and that have the internal resources to build out a fraud service in house since most of the heavy algorithm lifting is already built by Amazon. In addition, third-party developers who may want to build a fraud solution from the ground up or payment processors who wish to add another layer of machine learning fraud detection functionality to their service may find the solution appealing.  

It will be interesting to see how companies leverage this service in the future, I don’t think any of the bigger and more established and enterprise focused dedicated fraud solutions will have anything to worry about. However, some of the smaller players who focus on SMB merchants may start to feel a more competitive landscape. 

I believe we’ll see a rise in fraud solutions catering to various niche markets and the industry will likely get a bit more crowded in the next few years. The revenue model for such solutions is still very lucrative and there are still massive opportunities available. Needless to say the eCommerce Fraud industry will be an exciting space in the coming years. 

If you want to dig more into the AWS Fraud Detector Service and take a look under-the-hood you can read the Implementation Guide. Please keep in mind this is a very technical document. 

Tags: Amazon Fraud DetectorAWS
ShareTweetShareSend
Previous Post

Easi and Adyen Form New Partnership

Next Post

Merchant Fraud Journal’s Top 5 Posts of 2019

Next Post
Merchant Fraud Journal’s Top 5 Posts of 2019

Merchant Fraud Journal's Top 5 Posts of 2019

Our Latest Reports

2022 Chargeback Consumer Survey Report

Fraud Prevention Tactics that Enable Exceptional Customer Experience

Addressing Payment Fraud and The Customer Experience in 2022

2022 Fraud Trends Report

ATO Fraud In Retail Report

2022 Customer Experience Report

3 Ways a Unified Chargeback Management and Fraud Platform Increases Revenue

Digital Trust And Safety Report: Combating the Evolving Complexities of Payment Fraud

On-Demand Webinars

Balancing Customer Experience and Fraud Prevention: What’s the Secret?

Stopping Fraud Across the Customer Lifecycle

Addressing Payment Fraud and the Customer Experience in 2022

 

Get the 2023 Fraud Trends Report

Search Our Site

No Result
View All Result

Our Sponsors

Featured Directory Listings

  • logo
    NoFraud
  • SEON. Fraud Fighters
  • sift logo
    Sift
  • Signifyd
  • Ekata
  • Microsoft Dynamics 365 Fraud Protection
  • PayRetailers
  • Spotrisk

Our Sponsors

Fraud Industry News

Moving identity authentication earlier in customer flow is top of mind at MRC Vegas 2023:

Moving identity authentication earlier in customer flow is top of mind at MRC Vegas 2023:

March 28, 2023
How to Strengthen Your Small Business’s Defenses Against Identity Theft

How to Strengthen Your Small Business’s Defenses Against Identity Theft

March 23, 2023
How Companies Can Avoid Zero-Party Data Fraud

How Companies Can Avoid Zero-Party Data Fraud

March 13, 2023

Connect With Us

Quick Navigation

  • Home
  • News
  • Join Us
  • About Us
  • Contact Us
  • Advertise
  • Contribute
  • Privacy Policy

The Payments Media Network

Merchant Fraud Journal
Payments Review

Privacy Policy

Our Privacy Policy
Our Terms of Use

Resources

  • Articles
  • eCommerce Fraud Reports
  • eCommerce Fraud Webinars
  • Training and Certifications
  • Jobs Board
  • Associations and Non-Profits
  • Podcasts
  • Vendor Directory

Popular Posts

  • How to File a Claim With FedEx + What To Do If Claim is Denied

    How to File a Claim With FedEx + What To Do If Claim is Denied

    0 shares
    Share 0 Tweet 0
  • How Does Two-Factor Authentication (2FA) Work?

    0 shares
    Share 0 Tweet 0
  • Top eCommerce Fraud Prevention Companies

    0 shares
    Share 0 Tweet 0
  • The Best Reverse Email Lookup Tools in 2022 (with pricing)

    0 shares
    Share 0 Tweet 0

Featured Vendors

  • NoFraud
  • SEON. Fraud Fighters
  • Sift
  • Signifyd
  • Ekata
  • Microsoft Dynamics 365 Fraud Protection
  • PayRetailers
  • Spotrisk

Download the 2023 Fraud Trends Report

No Result
View All Result
  • About Merchant Fraud Journal
    • Interested in Contributing or Guest Posting to Merchant Fraud Journal?
  • Advertise on Merchant Fraud Journal
  • Articles
    • Chargebacks
    • Fraud Prevention
    • Influencer Insights
  • Contact Us
  • Download Addressing Payment Fraud and Customer Experience Report
  • Download Chargebacks Consumer Survey Report 2022
  • Download Evolving Complexities of Payment Fraud Report
  • Download Fraud Prevention Tactics that Enable Exceptional Customer Experiences Report
  • Download Merchant Fraud Journal 2023 Fraud Trends Report
  • Download the 2020 Chargeback and Representment Report
  • Download the 2020 Merchant Fraud Journal Vendor Guide
  • Download the 2021 Fraud Trends Report
  • Download the 2022 Fraud Trends Report
  • Download the 3 Ways a Unified Chargeback Management and Fraud Platform Increases Revenue Report
  • Download the MFJ 2022 Customer Experience Report
  • Download the MFJ ATO in Retail Report
  • Home
  • Job Dashboard
  • Join The Merchant Fraud Journal Community
  • Merchant Fraud Journal Advertising Agreement
  • MFJ Fraud Trends Report Giveaway
  • News
  • Post a Job
  • Privacy Policy
  • Resources
    • 2020 Chargeback Representment Guide for Merchants
    • 2020 Vendor Guide
    • 3 Ways a Unified Chargeback Management and Fraud Platform Increases Revenue
    • Addressing Payment Fraud and the Customer Experience in 2022
    • Associations and Non-Profits
    • ATO Fraud In Retail Report
    • Balancing Customer Experience and Fraud Prevention: What’s the Secret?
    • Chargebacks Consumer Survey Report 2022
    • Digital Trust & Safety: Combating the Evolving Complexities of Payment Fraud
    • eCommerce Fraud Reports
    • eCommerce Fraud Webinars
    • Fraud Prevention Tactics that Enable Exceptional Customer Experiences
    • Fraud Prevention Training and Certifications
    • How to Build a Recession Proof Chargeback Prevention Strategy
    • How to Stop Fraud During the 2022 Holiday Season
    • Jobs Board
    • Merchant Fraud Journal 2023 Fraud Trends Report
    • Merchant Fraud Journal’s Fraud Trends 2020 Report
    • Merchant Fraud Journal’s Fraud Trends 2021 Report
    • Merchant Fraud Journal’s Fraud Trends 2022 Report
    • MFJ’s 2022 Customer Experience Report
    • Podcasts
    • Prevent High-Velocity Fraud Attacks During the 2021 Holiday Season
    • Stopping Fraud Across the Customer Lifecycle
    • Vendor Directory
    • Webinar – Addressing Payment Fraud and the Customer Experience in 2022
    • Webinar – Mitigating Fraud and Risk on the ACH Network
    • Win January Chargeback Disputes
  • Subscribed
  • Terms and Conditions

© 2021 Payments Media Solutions Canada Inc.

Are you sure want to unlock this post?
Unlock left : 0
Are you sure want to cancel subscription?