Enhancing Fraud Detection Mechanisms in Financial Systems Through Artificial Intelligence

Abstract

The increasing sophistication of financial fraud in the modern digital economy poses significant challenges to traditional detection methods. The application of Artificial Intelligence (AI) in financial fraud detection has emerged as a critical strategy for enhancing security across financial platforms. This paper examines the role of AI technologies in identifying and mitigating fraudulent activities within financial transactions. The study explores various AI techniques, including machine learning, neural networks, and natural language processing, highlighting their efficacy in detecting anomalies, preventing fraud, and improving overall security. The research also discusses the integration of AI with existing fraud detection frameworks and its impact on reducing human error, operational costs, and response time to fraudulent activities.