Financial fraud is a serious problem, and Mohammed Alhussein knows this. He also understands that technology, which powers a good chunk of today's financial world, is a double-edged sword.
The reason? Anyone can access it, and can use it for their own purposes. This is why he is determined to provide solutions to enterprises and consumers to have the upper hand when it comes to online financial transactions and the risk of fraud.
“As the world is transforming, we gain a lot of speed, because we're offering our financial services digitally,” Mr Alhussein tells The National.
“However, attackers and fraudsters also are gaining from this digital transformation by also having access to the same digital infrastructure that we have.”
Mr Alhussein is the founder and chief executive of Mozn, a Saudi company that utilises artificial intelligence to build products and solutions to prevent online fraud which, he says, ultimately helps the “advancement of digital humanity”.
The seeds for Mozn – which is Arabic for “rain” and, in the company's case, “helpful rain” – were sown in 2017.
This was when Mr Alhussein realised, through his conversations with individuals and entities in the GCC – mainly Saudi Arabia and the UAE – as a financial hub is a natural target for online fraudsters.
“Money laundering and fraud are two serious problems – locally, regionally and globally,” says Mr Alhussein.
These two crimes aren't new, but the techniques being used to execute them have certainly evolved, thanks to more powerful tech tools at the disposal of cyber criminals, “which is creating a big problem”, he says.
Mr Alhussein says in the past, consumers had more time to understand risks. For instance, when applying for a credit card, a customer had to go to a bank, open an account and wait for some days before they would get their card.
This gave them the opportunity to clearly understand the risks, as well as the steps that could help them guard against the unauthorised use of their card.
Today, with everything being digital and customers requiring instant and real-time transactions, the challenge is huge and entirely different. Cyber crooks also have multiple avenues in which they can launch their attacks on unsuspecting users.
The growing adoption of financial technology or FinTech and digital transactions has also led to higher cases of financial fraud.
“Our region is a financial hub. This is one of the strengths of our region. It requires innovation – technology that would help financial institutions bring more products and innovation to the region, but safely,” Mr Alhussein says.
The Mozn team has created a multipronged approach to combat financial fraud.
The first is helping financial institutions combat financial crime by leveraging data in AI, through a software-as-a-service platform.
Mozn does this using its Focal platform, a suite of products that leverages its own AI and machine learning technology to answer the challenges of fraud prevention in emerging markets.
“As we work with many organisations, we realised that AI is something that's actually very important for them,” Mr Alhussein says.
The second is that, given the GCC is going through a massive digital transformation, there is a need to provide expertise to help in the process of using AI and data to fuel this transformation.
“Whether it was government, private or banking, we saw this great inspiring determination to actually transform the region,” he says.
The third is that with a lot of data in the region being in Arabic, it made sense to develop a platform, also powered by AI, to localise data and integrate it into the systems of organisations.
“It was very clear that people had this appetite to embrace data, and we examined how decision making was being made,” Mr Alhussein says.
The fact that users have accepted that using AI is key in decision making “inspired us to start this journey”, he says.
The global fraud detection and prevention market is projected to grow at a compound annual growth rate of 23.3 per cent to $120 billion by 2028, from an estimated $34.15 billion in 2022, data from Expert Market Research shows.
The FinTech market, meanwhile, is expected to reach about $556.58 billion by 2030, from an estimated $133.84 billion in 2022, growing at a compound annual growth rate of nearly 20 per cent, according to Vantage Market Research.
“As a lot of different technologies come into the world, they definitely have a lot of benefits that we can witness and experience,” Mr Alhussein says.
Mozn has recently expanded its reach in the region by opening an office in the UAE, a move Mr Alhussein believes will help the company reach out to more enterprises that will, subsequently, reach end consumers.
“We realise the boom in the financial sector in the UAE, and we see it as the hub for financial institutions,” he says.
“We're super excited to see more innovative technology and offerings that we believe will require reliable solutions to help them continue offering their solutions in a secure and trusted way.”
In February 2022, Mozn announced that it secured $10 million in a Series A funding led by Riyadh-based Raed Ventures and Sukna Ventures, Abu Dhabi's Shorooq Partners, Dubai-based VentureSouq and other investors.
The investment will be used to fuel the expansion of the company, which has also accelerated its hiring that seeks top talent in product development, engineering, data science and other specialities.
“As we expand our plans to keep expanding and into emerging markets, we're super excited about Mena now, where we see a lot of transformation is happening,” Mr Alhussein says.
“That will require more and more innovation on how to safeguard the transformation that's happening in the financial system.”
Mr Alhussein acknowledges that the rapid evolution of new technology requires more regulation and understanding of the risks that come with them.
AI is definitely one of them. The emergence of generative AI made popular by Microsoft-backed OpenAI's ChatGPT – a technology that has become a buzzword for enterprises and consumers, has supercharged its development.
“I think AI is not different from any other technology that we have. We witnessed how the internet changed the world 20 to 30 years ago. In the beginning, our understanding was definitely limited, so regulators' understanding was also limited,” he says.
“But as they came to understand the technology, they were able to put in place regulations.”
It's a challenging battle, but Mozn is in it for the long term. The company has committed to develop more services and is planning to reach out to more enterprises and users in order to bring their “safety” message across, Mr Alhussein says.
“If you look at financial institutions and their journey to offer the great services, they have to make sure that they're doing these things safely. At the end of the day, they have to make a decision on who they work with and how do they make sure that their customers are safe,” he says.
“Our role is definitely to provide that innovative software product that helps them do that.”
Q&A with Mohammed Alhussein, founder and chief executive of Mozn
Is there enough awareness in the region about online financial fraud?
There are definitely efforts, and it will be extremely helpful if those efforts continue and grow. Fraud is a problem that's going to continue to be a problem. We like what's happening in terms of the steps that the ecosystem is taking, but there is definitely room for more.
How did the Covid-19 pandemic affect you?
Our team actually doubled in size. So, we believed strongly in the field that we work in, the market and its fundamentals. Think about it this way: because of the pandemic, regulators started allowing banks to be more digital, so, this increased the need for products that make sure all of this is happening in a secure way.
Had you not started Mozn, what would you have done?
If I go back in time, it's very difficult for me to predict that I'll be working in the financial sector. I think what I did was looking at the opportunities that were challenging. I could have ended up doing something different. I know I would do something, I’m just not sure what. Maybe something on sports, because I love it.
Ever thought about developing something to rival ChatGPT?
Our focus is definitely creating technology that will help organisations unlock the potential of their Arabic data. We believe, years of research and development provides our clients with the best possible way to unlock that.