Lessons from a fraudster

By André Ferraz, CEO and Co-Founder at Incognia

I don’t admire fraudsters. 

But I do respect their persistence. 

You have to give credit where it’s due. 

Fraudsters are a creative bunch. They’re adaptive and clever.

And they’re willing to put up with high levels of tedium and repetition if they know they’ll get a profit out of it. 

So, what can we learn from the average fraudster’s attitude toward their craft? 

It’s important for us not to underestimate our opponents. 

Fraudsters have serious skills. 

Some might dismiss fraudsters as lowlifes or common criminals. 

But if they were really just unskilled nobodies, the issue of fraud would’ve been solved ages ago. 

The simple truth is that many fraudsters are talented. 

They’re good at what they do, and they’re only getting better. 

When we find one way to stop them, they find ways to get back in. 

Fraudsters are not as lazy as you might think. 

Even with some automation in place, it takes a lot of patience to:

• Create hundreds of accounts on a single platform.
• Run dozens of instances of one app using an app cloner, and send phishing messages on all of them. 
• Configure an emulator and run dozens of app instances on dozens of emulated phones, carrying out multiple fraud schemes at once.  

Tedium isn’t an obstacle for fraudsters if there’s money to be made.

They’ll automate what they can and grind through what they can’t. 

Fraudsters are persistent. 

When they find out one vulnerability has been patched, they go looking for others. 

They test what they find. They think about the problem. They research.

And then they get to work stealing money from platforms and their users. 

Whenever fraud prevention technology catches up with them, they just find new workarounds.

So let’s recap what we’ve learned.

Fraudsters are:

• Skilled at committing fraud
• Willing to invest lots of time and effort
• Ready to adapt and persist when fraud prevention catches up  

What can we take from this as fraud fighters? 

Fraudsters have some pretty impressive traits. But so do fraud fighters. 

They’re skilled at committing fraud? We’re skilled at stopping it. 

They’re willing to invest time and effort into fraud schemes? We invest time and effort, on an industry-wide scale, into fighting them. 

They adapt quickly when fraud prevention advances? We’re developing innovative solutions that cut them off at the root and stop the Whac-a-Mole antics for good. 

It’s important not to underestimate our opponent. 

But we shouldn’t underestimate ourselves, either. 

We’ve got all the skills of the average fraudster and more—it’s just a matter of putting them to use.

Explore Incognia's podcast

Have you listened to our podcast, Trust & Safety Mavericks? Here are a few recent episodes you might enjoy:

Real-time fraud prevention in the age of faster payments

Incognia's CEO André Ferraz talks with Julie Conroy from Datos Insights and Lenny Gusel about the challenges of preventing fraud related to faster payments.

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The User Verification Tightrope: Balancing security and user experience

Experts from StockX, Sittercity, and Incognia discuss the delicate balance between robust user verification measures and delivering a hassle-free onboarding experience.

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The Real Full Stack: People, Processes, Technology, Data

Kyle Caldwell from M&T Bank and André Ferraz break down common mistakes organizations make when designing fraud prevention strategies and share their top recommendations for mastering this juggling act.

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Incognia, a digital identity company, detects fake account creation and account takeover attempts for gig economy, marketplace, and financial technology applications. Benefits of using Incognia’s location-based digital identity include reduced false positives and a low friction user experience.