Fraud Reduction Intelligence Platforms

Fraud imposes major and rising costs on businesses, with global cybercrime-related losses estimated at $2 trillion in 2019 and projected to reach $6 trillion by 2021. While banking, finance, payments, and retail remain prime targets, attackers increasingly pursue insurance, gaming, telecommunications, health care, cryptocurrency exchanges, travel, hospitality, and real estate as more online services exchange monetary equivalents. Fraudsters also shift toward targets of opportunity as traditional financial sectors harden defenses, and they continually diversify their tactics, techniques, and procedures.

Key fraud types include account takeover (often driven by breached passwords and credential stuffing), new account or synthetic fraud built from stitched-together PII, insider fraud (including IP and CRM data theft), screen scraping, inventory depletion by bots, fraudulent insurance claims via captured agent credentials, escrow misdirection in real estate, and mobile overlay attacks against banking and travel apps. A core mitigation is risk-based multi-factor authentication, which evaluates user, device, and environmental context at transaction time and can raise assurance via identity proofing, behavioral analytics, passive biometrics, and related signals. Insider fraud requires different controls because access conditions may be legitimately met; monitoring, behavioral analysis, least privilege, and separation of duties are emphasized.

Fraud Reduction Intelligence Platforms (FRIPs) optimize risk-based MFA and transaction decisions by providing identity proofing, credential intelligence, device intelligence, user behavioral analysis, passive biometrics, and bot detection/management—often using ML for real-time scoring and policy-driven actions. The FRIP market is mature, largely SaaS and priced by transaction volume, with vendors varying widely in feature breadth and targeted industries. Leadership ratings identify Overall Leaders (Broadcom, Gurucul, IBM, RSA, Transmit Security) and highlight how market share, product completeness, and innovation correlate across vendors.

• Total cybercrime-related costs were estimated at $2 trillion globally in 2019 and projected to rise to $6 trillion by 2021.
• Account takeover most often occurs when breached passwords and credential stuffing enable unauthorized transactions.
• New account fraud can involve assembling illegitimate accounts from bits of PII drawn from educational, financial, or medical records.
• Real estate escrow misdirection commonly results in unrecoverable transfers that can be devastating to home buyers.
• FRIP solutions generally provide six major functions: identity proofing/vetting, credential intelligence, device intelligence, user behavioral analysis, behavioral/passive biometrics, and bot detection & management.
• FRIP services are generally offered as SaaS and are often priced per transaction volume.
• Overall Leaders (alphabetical) are Broadcom, Gurucul, IBM, RSA, and Transmit Security.
• Product Leaders (alphabetical) are Arkose Labs, Broadcom, Gurucul, IBM, ID DataWeb, and Transmit Security.
• Innovation Leaders (alphabetical) are Arkose Labs, IBM, ID Dataweb, Gurucul, and Transmit Security.
• Market Leaders (alphabetical) are Broadcom, Gurucul, IBM, Neustar, RSA, Transmit Security, and TransUnion.

• “Fraud perpetrators also continually diversify their Tactics, Techniques, and Procedures (TTPs).”
• “One of the chief mitigations against these types of fraud is risk-based multi-factor authentication (MFA).”
• “Insider Fraud is handled differently due to the fact that in many cases, the access policy conditions are met because the individual(s) are authorized.”
• “Risk-based MFA is characterized by transaction-time evaluation of multiple factors, including information about users, their devices, and the environments from which requests emanate.”
• “FRIP solutions operate optimally when integrated with or informed by Fraud Reduction Intelligence Platforms (FRIPs).”
• “Some vendors have about every feature one could want in a FRIP service, while others are more specialized, and thus have different kinds of technical capabilities.”
• “In general, identity proofing and vetting is quite specialized and is not found in all FRIP services.”
• “There are no Followers, indicating that this market segment has, in general, a good mix of mature solutions.”
• “Innovation is not about delivering a constant flow of new releases.”
• “Selecting a vendor of a product or service must not only be based on the information provided in a KuppingerCole Leadership Compass.”