Home United States USA — software Fraugster, a startup that uses AI to detect payment fraud, raises $5M

Fraugster, a startup that uses AI to detect payment fraud, raises $5M

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NewsHubFraugster , a German and Israeli startup that has developed Artificial Intelligence (AI) technology to help eliminate payment fraud, has raised $5 million in funding.
Earlybird led the round, alongside existing investors Speedinvest, Seedcamp and an unnamed large Swiss family office. The new capital will be used to add to Fraugster’s headcount as it expands internationally.
Founded in 2014 by Max Laemmle, who previously co-founded payment gateway company Better Payment, and Chen Zamir, who I’m told has spent more than a decade in different analytics and risk management roles including five years at PayPal, Fraugster says it’s already handling almost $15 billion in transaction volume for “several thousand” international merchants and payment service providers, including (and most notably) Visa.
Its AI-powered fraud detection technology learns from each transaction in real-time and claims to be able to anticipate fraudulent attacks even before they happen. The result is that Fraugster can reduce fraud by 70 per cent while increasing conversion rates by as much as 35 per cent. The point of any fraud detection technology, AI-driven or otherwise, is to stop fraudulent transactions whilst eliminating false positives.

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