About Tamas Kadar: Tamas Kadar is an entrepreneur and former founder of Central Europe’s first crypto exchange. When his enterprise was targeted by fraudsters, he pivoted to offering fraud prevention technology. His newest firm, SEON, now protects 5000+ companies worldwide and raised the largest ever Series A funding in Hungary.
In this exclusive Cyber Talk interview, CEO Tamas Kadar shares insights into the newest fraud nightmares, Fraud-as-a-Service, and what businesses need to know in order to effectively fight fraud.
For those who missed our first interview with you, please tell us a bit about the SEON story:
SEON started when my friend Bence and I met at university in 2016, and bonded over our interest in cryptocurrencies. Our first project together was a crypto exchange for the CEE region. Unfortunately, we were soon the target of constant attacks from fraudsters.
After trying several fraud prevention solutions, we came to the conclusion that we could build a better one ourselves. It worked so well that, soon, we decided to sell it to other businesses. This April, we completed a $94 million Series B and are now the fraud prevention of choice for Revolut, Mollie, Afterpay, and 5000+ other digital leaders.
What are the newest fraud nightmares that business leaders should know about?
I think synthetic IDs are about to cause a lot more headaches for companies. It’s what happens when a fraudster combines real ID data that were stolen (or bought) and fake data.
The access to new technologies like deepfakes also makes it much easier to create convincing selfie videos to pass identity verification. And fraudsters’ groups are becoming increasingly sophisticated, organized, and shameless.
In the fraud ecosystem, what are you seeing in terms of Fraud-as-a-Service?
Fraud-as-a-Service is another worrying trend. We’ve seen services where you can hire someone to commit return fraud against an online store or e-commerce business. Others will offer carding – purchases with stolen credit card numbers.
It really picked up steam during the COVID years, but it’s still going strong in our times of financial instability.
What’s shocking is that it shows how brazen fraudsters have become. They have no problem advertising their services on the clear web or on well-known channels.
And of course, the issue isn’t just that they get paid for their services – it’s also that the people who hire them can become victims of more fraud. Would you really trust a criminal to work for you?
Where are most organizations when it comes to fraud risk management?
The problem most organizations have is that they don’t anticipate risk until it’s too late.
So they are reactive rather than proactive. And when they realize they need to fortify their defenses, their main options are legacy providers who are expensive, inflexible and work with stale data.
Where do they need to be?
A new wave of fraud prevention providers is doing wonders to help companies work with better data via data enrichment. That means information about your users that’s fresh, doesn’t come from old blocklists, and includes things like social media checks.
This is particularly true of companies that need to reduce friction without sacrificing security. There is a lot you can learn about users based on very simple data points, whether that’s for KYC or credit scoring in markets where the financial information is scarce.
Tell us about SEON’s approach to fraud management?
Our big discovery with SEON was that very few providers offer a real SaaS model. It’s very much a club of legacy providers with antiquated technology. You had to buy the whole solution and you would get features you didn’t need.
We decided to go the other way. We broke down our features into modules and APIs, so companies can choose the data enrichment and machine learning powered insights that make the most sense for them.
We also offer things like 30-day trials, free integration and cancel-anytime plans, which were virtually unheard of in the industry.
You recently received new funding (congratulations!). How will SEON expand?
Thank you. Yes, we recently completed Series B, raising $94 million.
We’re very pleased to have been funded by people whose careers we admire – so a key step is to learn from our investors’ success and to apply it to SEON’s growth.
We’re also scaling our operations globally and continuously adding to and improving on our existing features. We want to help our customers become better fraud fighters by delivering the best tools possible.
Anything else that you wish to share with the CyberTalk.org audience?
Companies often see security and fraud prevention as a trade off. What we keep seeing over and over again is that they come to us too late in their growth journey, after they’re already suffering from fraud losses.
I think, ultimately, more businesses should think about fraud prevention as a cornerstone of doing business in the digital age – not just a nice option to have.
For more insights from CEO and Co-Founder of SEON, Tamas Kadar, please see CyberTalk.org’s past interview. Lastly, to receive more cutting-edge cyber security news, best practices and analyses, please sign up for the CyberTalk.org newsletter.