How Navy Federal harnesses AI to confront scam activity

AI is changing the landscape of how lenders identify fraudulent activity, and this has direct implications for your storefront. Navy Federal Credit Union is currently shifting its focus from traditional identity theft (fraud) to 'authorized' scams. In these scenarios, your actual customers are being manipulated by third parties to make purchases or transfers they wouldn't normally make. For retailers, this often manifests as high-ticket purchases that appear legitimate but result in chargebacks or disputes once the customer realizes they were coached by a scammer. Navy Federal is deploying AI models to look for behavioral anomalies rather than just stolen credentials. This means lenders are getting better at spotting if a customer is on a live phone call while trying to apply for financing or if their typing patterns suggest they are being told what to do. As a merchant, you should expect more sophisticated 'friction' during the credit application process. While extra verification steps can be annoying at the point of sale, these AI tools are designed to protect your revenue by ensuring the transaction isn't clawed back later due to a scam claim. The shift toward 'behavioral biometrics' means the financing journey is becoming more about how the customer interacts with the device, not just the data they enter.

Source: Banking Dive

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