By Kennedy Rose – ReporterNovember 22, 2021, 10:50pm EST


A former Citi executive’s Bala Cynwyd artificial intelligence fraud prevention startup secured $5 million for its Series A.

Aravind Immaneni, former head of global operations and fraud prevention at Citi, founded Guardinex in 2018 but kept the company dormant until he left Citi in 2020. Immaneni has also held executive positions at Fifth Third Bank, TD Bank and Capital One. 

Guardinex’s cloud-based platform connects to client applications and identifies fraud risk in real-time using AI and behavior models that predict fraudster tactics. It can be used on both a small and large scale, such as individually looking at new accounts opened or continuously analyzing a portfolio to detect fraudulent behavior.

LL Funds, a Philadelphia-based private equity firm focused on investments in specialty finance companies, led the funding round. An affiliate of Ohio-based CBC Companies also participated in the Series A. The funding puts Guardinex’s valuation at $25 million, Immaneni said.

The Series A was raised to scale the startup. Guardinex has several patents, a core set of customers and proof that its technology works, Immaneni said, and the startup will use the funding to build on its technology platform and hire three employees in sales, data science, and product development in the Philadelphia area.

Immaneni declined to share the company’s revenue figures.

Identity fraud losses totaled $56 billion in 2020, affecting 49 million consumers, according to a study from Javelin Strategy & Research. Those losses get passed on to consumers by financial institutions in the form of fees, Immaneni said.

“One way or the other, these costs are affecting all of us, and definitely those who are impacted more directly, and we’re trying to solve it and make financial institutions and personal information safer for everybody,” Immaneni said. “That’s our mission.”

Guardinex’s platform isn’t an identity verification system like other fraud prevention services. It uses machine learning to identify fraudster behavior during high-risk transactions. The company’s products help financial institutions identify fraudsters opening accounts, taking over other people’s accounts and committing payment fraud through digital services like Zelle and Venmo.

The startup plans to develop several new products using data analytics modeling next year, Immaneni said.

Immaneni chose to launch Guardinex in Bala Cynwyd — rather than in New  York when he was at Citi — because of the “hotbed” of talent in the Philadelphia and Wilmington area. Banks like JPMorgan Chase, Capital One, and Citi had risk and fraud prevention operations in Wilmington, and Princeton has a high level of data science and analytics talent, making the region ideal, he said. 

Many of Guardinex’s clients are also headquartered on the East Coast, making Bala Cynwyd a suitable location for the startup’s home base.

“Between New York and Wilmington, there’s a lot of key decision-makers in our client base,” Immaneni said.

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