VPN IP detection for compliance of any fraud prevention system, but it shouldn’t be the sole deciding factor. It should be one of many signals that are taken into account when building a full risk profile of an individual user. While VPNs have a number of legitimate uses (such as enabling employees to work remotely via company-owned virtual private networks) they also are commonly used to conceal malicious activity, from credential stuffing and account takeovers to DDoS attacks and other types of network abuse.

Using VPNs to obfuscate digital identity undermines all types of location-dependent systems and services, from content restrictions to regional compliance rules. They can also be used to hide ad fraud, which relies on users’ obfuscated connection details. For example, a VPN server can appear to be from multiple locations at the same time, masking geographic data that would otherwise reveal an ad’s true origin.

VPN IP Detection for Compliance: Ensure Secure and Transparent User Access

The most effective way to detect VPN usage is through a combination of device fingerprinting and advanced network analysis. SEON’s solution combines these technologies to identify and flag VPN, residential proxy, mobile proxy, Tor, and other privacy service providers and their obfuscation methods. The platform also identifies specific features of these proxies and privacy services, giving teams greater context to refine their detection rules and build more sophisticated models for mitigating risks.

While preventing all VPN connections is impractical and risks labeling real customers or employees as criminals, it’s important to incorporate VPN/Proxy detection into fraud prevention algorithms to reduce friction. The right fraud prevention system can sift through traffic, identifying characteristics that suggest the use of a VPN or proxy, such as high encrypted traffic volumes, rapid changes in location and behavior, or other anomalous activity.