Financial Fraud Detection Methods in Japan Gain Traction with Cloud-Based AI Startup Caulis Inc.

Caulis Inc., a Japanese cybersecurity startup, has developed a cloud-based artificial intelligence (AI) system to combat account hijacking and identity theft. The company’s FraudAlert risk detection engine uses past user behavior to predict fraudulent access patterns, alerting clients to high-risk accesses and enabling them to implement countermeasures.

How it Works

The more data FraudAlert stores, the better it learns to recognize common user behaviors and unusual activity. The system is embedded with JavaScript codes in client websites, which communicate user behavior information to the cloud-based FraudAlert system. This allows for an increasingly accurate estimation of whether an access attempt is legitimate.

Benefits

• Minimizes integration time
• Offers low monthly premiums compared to other anti-fraud solutions
• Already protects over 50 million users registered with major communications companies, e-commerce sites, ticketing services, and more

Patent-Pending Mechanism

Shimazu is working on patenting a mechanism that shares the system’s database of suspicious internet protocol (IP) addresses through application program interfaces (APIs) between clients’ business operators, making it easier to spot repeat offenders. He is also developing unique functions for Caulis services, with plans to patent them internationally.

Showcasing FraudAlert

FraudAlert was featured at the 2016 Infinity Ventures Summit startup pitch contest and showcased at TechCrunch Tokyo and the inaugural Singapore FinTech Festival.

Future Plans

• Establish a branch office in Singapore and begin test marketing there within the next year
• Develop a multilingual version of FraudAlert’s client dashboard
• Win over major companies such as banks and mobile carriers in the region within the next five years

Anticipating Increased Hacking Attempts

As Japan prepares for the 2020 Tokyo Olympic and Paralympic Games, Shimazu anticipates an increase in hacking attempts targeting the country. To combat this, he plans to form partnerships with companies dealing with identity theft protection technology, including fingerprint authentication, and set up a cyber-insurance service to handle cases of cyber-attacks.

Company Goals

“We want to focus our energy on becoming a company that can offer identity protection on a large scale, prior to and beyond 2020,” Shimazu says.