By December 29, 2021

How Developers Can Help Prevent ATO Fraud

ATO fraudIn the modern digital world, almost everything is moving online. Many businesses are shifting to e-commerce to gain a competitive edge over their competitors and conducting many of their day-to-day business activities online. The banking system is efficient with online transactions that help us and businesses make transactions anywhere in the world at any time.

Technology has made time-consuming tasks convenient and efficient for us. If a business is not moving online then it is lacking behind the competition. But with technological advances also comes a huge threat of fraud. Our presence on a digital platform has a huge risk of data leakage to cyber criminals, which can result in account takeover (ATO) fraud.

Account Takeover Fraud

It is a type of identity fraud where a cybercriminal steals or accesses your account for personal or financial gains. Just like the name sounds, account takeover fraud is when a cybercriminal takes over your account for personal and financial purposes.

Fraudsters and criminals are mostly interested in accessing accounts from where they can steal money. This is why most online banking accounts and e-commerce accounts are targeted. These accounts are profitable for criminals, as they can consist of huge amounts of money. However, other accounts like social media and mobile accounts are also targeted to threaten the account owner and ask for money.

Factors Causing ATO Frauds

There is a huge ATO threat that has been on the rise these past years. It is not just a threat for businesses but individuals as well. It is important to know which factors are leading to these frauds. The leading factors can be found below:

Data Breach

Data Breach is when your private and confidential information is leaked to others. Data breach helps cybercriminals to get access to your accounts. Information like username, passwords, account number, debit/credit card number, etc. is obtained by the breach and sold into the black market.

When the hackers get access to your information, they try the same combinations on different sites to log in by using different tools. Even when hackers get access to only emails or usernames, they try brute force to guess passwords.

Weak Passwords

Many individuals have more than a single online account. Remembering all account passwords can be hard, which is why many people use the same login for every account. According to one research study, 71% of people have admitted that they are using the same password for every account.

People are also not changing their passwords and keep using the same passwords for years. This practice can allow criminals to access every account of an individual by just hacking into one account.

Inefficient Authentication

Many organization login credentials are based on binary authentication. This means that only a username and password are needed for anyone to get access to the online platform. Criminals can do anything with your account.

Mobile Devices

Smartphone devices are the major target of ATO fraud. There is a huge technology lag that attracts cybercriminals to target mobile phones. Although there are many advanced tools available to protect devices, they do not work the same for mobile applications. Mobile phones are becoming a prime target, which is why they require the utmost attention.

How Can Developers Help To Prevent ATO Fraud?

It does not matter how big the threat is, the threat can always be prevented by taking cautions. Developers can help prevent fraud by taking additional security programs into account. Following are some of the few solutions that can help in preventing an ATO threat.

Identity Verification While Onboarding the End-User

In many cases, when ATO fraud is committed, the cybercriminal uses the same information found to create new accounts. If a developer is developing an app that is sensitive in nature, a breach can result in serious harm, which is why the application needs verification.

For example, many financial applications require identity verification for verifying customer identity while onboarding an end-user to verify their authenticity, which helps the business ensure the identity of real users and prevent fraudsters. Verification at the initial stage can prevent hackers from making another account of the individual they hacked earlier.

Monitoring Payment

Fraudsters and hackers commit ATO fraud for monetary purposes, which is why online banking applications are a common target. Modern technology has made it convenient for us to transfer money through mobile applications, but at the same time, this feature has attracted hackers’ attention.

As soon as a hacker gets a banking application, they withdraw all or a huge sum of the amount from the bank balance. Due to a lack of monitoring and authentication, the criminals are successful in stealing large amounts. Monitoring of payment and transfer is important for avoiding, or at least quickly catching, ATO fraud.

A developer can help build a system that calls for additional attention when there is a huge money transfer. This is why it is important to know your transaction. The only way of making a transaction is by verifying your identity. This can help prevent ATO frauds and money stealing.

Face Verification

Face verification is a part of advanced biometric authentication, which uses artificial intelligence and machine learning to learn your facial features. Face verification is one of the best techniques to verify the identity of an individual. Using this machine learning software will allow identifying fraudsters before they can enter into the system.

Developers can add face verification in applications to authenticate users while they are logging in. People are becoming much more aware of this verification, and it is being widely used thanks to smartphone locked screens. Requiring face verification every time a user logs in can help in preventing ATO frauds.

About the author

James Watson

James Watson is a a contributor and technical content writer. He has written on a broad range of topics and has a considerable number of articles relating to Artificial Intelligence, Machine Learning, Cyber Security, Fintech, Crypto, Finance and Business, etc. You can find more of his work on LinkedIn.