[sedachv]

I think it is valid to think in terms of expected value here, where value is negative (a loss), since there is a large volume of transactions so the law of large numbers will apply. Set a threshold of expected loss below which you will not flag transactions. Then either very large payments or relatively smaller payments to countries with a higher known percentage of fraudulent transactions will flag a transaction. You can further refine this if for example there is a relationship between observed fraud rate and transaction amount.

If a company profits off of fraudulent transactions and is aware of the fraud, and the attorney general or equivalent stops viewing this as negligence, there is an incentive for the company to encourage this fraud to increase profits.