Mastercard and Feedzai Join Forces to Combat Rising Crypto Exchange Fraud

Mastercard and Feedzai Join Forces to Combat Rising Crypto Exchange Fraud

by November 21, 2023

Feedzai, a financial crime and risk management solution provider, has joined forces with Mastercard to enhance crypto fraud protection. This collaboration aims to mitigate the risk of account-to-account fraud involving cryptocurrency exchanges.

Recent data reveals that approximately 40% of scam transactions originate directly from bank accounts and move to crypto exchanges. Feedzai’s latest “State of Global Anti Money Laundering (AML) Compliance Report 2023” highlights the ongoing challenge financial institutions face in effectively monitoring cryptocurrency transactions.

To address this issue, Feedzai will integrate Mastercard’s advanced crypto intelligence solution, Ciphertrace Armada, into its RiskOps platform.

This platform, which processes transaction data worth over US$1.7 trillion annually, utilises AI-driven solutions to identify and halt fraud and financial crimes at their inception. This integration will enable banks to receive immediate alerts for potentially fraudulent transactions.

Ciphertrace Armada is designed to assist banks, crypto exchanges, and other Virtual Asset Service Providers (VASPs) in assessing the fraud risk associated with digital asset transactions.

By combining these technologies, Feedzai’s clients, who safeguard over 900 million consumers worldwide, will be better equipped to detect and prevent transactions linked to fraudulent crypto exchanges.

This partnership follows Mastercard’s recent introduction of a new solution for banks to identify scams in account-to-account payments.

The Mastercard Consumer Fraud Risk system, powered by AI, allows banks to intervene instantly and prevent fraudulent payments from being processed.

With the merging of these technologies, financial institutions are now positioned to halt transactions with high-risk and potentially fraudulent crypto exchanges in real time, alerting customers to potential dangers before any funds are transferred from their accounts.

Nuno Sebastião

Nuno Sebastião

Nuno Sebastião, CEO of Feedzai said,

“Criminals use crypto as part of their scam strategies, with the scam proceeds often ending up being funneled 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

Ajay Bhalla

Ajay Bhalla, president of Cyber and Intelligence at Mastercard said,

“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.”