This thesis has been a valuable academic experience that deepened my understanding of how artificial intelligence is transforming fraud detection and risk management in the financial sector. Through extensive research and analysis, I explored how AI-based systems enhance the accuracy and efficiency of identifying fraudulent activities while addressing the ethical and managerial challenges they create. Conducting this study allowed me to connect theoretical insights with practical realities faced by financial institutions. It also strengthened my ability to think critically about the balance between technological innovation and responsible governance. Overall, this research reinforced my belief in the potential of AI to reshape fraud prevention and promote greater integrity within financial systems.