Proxy Detection - Why Fraudsters Give Proxies a Bad Name

When it comes to fraud detection, finding proxies is a big topic. But why? Fraud detection begins with thinking intelligently about the IP address associated with a transaction. Where is that IP address, and how does that location relate to other transaction data? Whereas most IP addresses inspire confidence, those associated with a proxy generate suspicion. Let’s take a closer look at proxy detection. As its name suggests, a proxy acts as an intermediary, passing requests from one computer to other servers. But although there are legitimate uses of proxies, fraudsters find it useful to take advantage of one of its characteristics; accessing the Internet through a proxy makes it more difficult to locate a user by means of an IP address. This enables some to use anonymizing proxies to access content from which they would otherwise be blocked. Others use open proxies to hide their whereabouts and thereby circumvent fraud detection rules associated with location.