AI-Powered Fraud Is Redefining Risk: What High-Risk Businesses Need to Know

Artificial Intelligence is reshaping payments, but not always for the better. While businesses are using AI to improve security, speed, and customer experience, fraudsters are leveraging the same technology to attack the financial ecosystem at scale.

At the recent Visa Payments Vault event in Washington D.C., Visa’s SVP of Payment Ecosystem Risk and Control, Michael Jabbara, highlighted how AI-fueled fraud is becoming one of the most complex challenges for both businesses and payment networks. His insights carry an important message for high-risk merchants who already operate in a world where compliance, fraud prevention, and reputation management are constant balancing acts.

Here’s what PayConsults believes every high-risk business should take away from these emerging trends.

1. AI Has Supercharged Global Fraud

The cost of cybercrime has surged over 30% year-over-year for six consecutive years, now expected to exceed $10.5 trillion globally in 2025. Fraud has effectively become a hidden “tax” on the global economy, one that drains legitimate businesses while fueling criminal enterprises like trafficking and dark web markets.

For high-risk industries such as iGaming, adult entertainment, nutraceuticals, and CBD, where chargebacks and online anonymity are already key risks, this AI-powered fraud escalation is not just a headline, it’s an existential threat.

2. Fraudsters Are Adopting AI Faster Than Businesses

While many companies are still exploring how to integrate AI into their operations, fraudsters have been using it for years. From AI-generated deepfakes and phishing content to automated malware and scam sites, attackers now have scalable, low-cost tools that mimic legitimate users and overwhelm fraud systems.

For high-risk merchants, this means older fraud filters or static rules are no longer enough. Fraud now looks human, and reacts faster than humans can.

3. Fighting AI With AI: The Smarter Way Forward

The answer isn’t panic, it’s adaptation. Visa’s approach offers a strong blueprint for businesses everywhere: use AI to fight AI.

Over the past five years, Visa has invested more than $12 billion in AI-driven fraud prevention, stopping an estimated $14 billion in fraud in the U.S. alone last year. Their systems monitor billions of data points in real time to detect and stop fraudulent behavior before it reaches the merchant.

At PayConsults, we apply a similar mindset, helping merchants deploy intelligent risk rules, BIN blocking, GEO filtering, and adaptive fraud orchestration to reduce exposure while keeping conversion rates high.

4. The Human Element: Awareness Is Still the Weakest Link

Technology helps, but human behavior remains the biggest vulnerability. According to Jabbara, most scams rely on one emotional trigger, urgency. If someone pressures you to act fast while you’re either excited or fearful, that’s your first red flag.

The same applies to businesses: decisions made in panic, like disabling fraud filters during peak traffic, can be costly. Patience, verification, and process discipline remain critical defenses in high-risk environments.

5. Strengthen Your Internal Defenses

While AI can catch patterns faster, internal discipline keeps your foundation strong. Every high-risk business should:

✅ Use complex passwords and multi-factor authentication.

✅ Enable transaction alerts for all merchant and settlement accounts.

✅ Limit access to financial systems and monitor payout requests from affiliates or partners.

✅ Partner with PSPs and acquirers who provide real-time fraud monitoring and transparent data visibility.

6. What’s Next: Smarter Threats, Smarter Defenses

Fraudsters are moving toward agentic AI, systems that can act autonomously, mimic human logic, and manipulate payment flows in real time. In response, payment networks and acquirers are developing adaptive AI defenses that can predict and block fraud dynamically instead of reacting after losses occur.

For high-risk merchants, this shift means manual fraud prevention won’t cut it anymore. Automation, orchestration, and AI-driven compliance are the new baseline.

7. Prevention Is the Real Performance Metric

Unlike marketing or sales, where results are visible, effective fraud prevention means nothing happens, and that’s the success.As Jabbara put it, the ROI of risk management lies in what doesn’t occur: no chargebacks, no frozen accounts, no acquirer terminations.

At PayConsults, we help high-risk merchants reframe prevention as performance, integrating fraud monitoring, compliance automation, and acquirer communication into a single, measurable framework.

The Future Belongs to the Proactive

AI is changing the game, and high-risk businesses can’t afford to play catch-up. The difference between thriving and failing in this ecosystem lies in foresight, not reaction.

With the right technology, risk intelligence, and strategic guidance, you can turn AI from a threat into a competitive advantage.

At PayConsults, we help high-risk merchants strengthen their payment stack, reduce chargebacks, and stay compliant, one smart decision at a time.