DEVELOPMENT OF THE AUTOMATED FRAUD DETECTION SYSTEM CONCEPT IN PAYMENT SYSTEMS

2021 ◽  
Vol 4 (1) ◽  
pp. 37-46
Author(s):  
Iuliia L. Khlevna ◽  
Bohdan S. Koval
Keyword(s):  
Financial Institutions ◽  
Detection System ◽  
Fraud Detection ◽  
Task Type ◽  
Automated System ◽  
Payment Systems ◽  
Detection Mechanism ◽  
Data Set ◽  
Software Product ◽  
Aws Lambda

The paper presents the demand for the spread of payment systems. This is caused by the development of technology. The open issue of application of payment systems - fraud - is singled out. It is established that there is no effective algorithm that would be the standard for all financial institutions in detecting and preventing fraud. This is due to the fact that approaches to fraud are dynamic and require constant revision of forecasts. Prospects for the development of scientific and practical approaches to prevent fraudulent transactions in payment systems have been identified. It has been researched that machine learning is appropriate in solving the problem of detecting fraud in payment systems. At the same time, the detection of fraud in payment systems is not only to build the algorithmic core, but also to build a reliable automated system, which in real time, under high load, is able to control data flows and effectively operate the algorithmic core of the system. The paper describes the architecture, principles and operation models, the infrastructure of the automated fraud detection mechanism in payment systems. The expediency of using a cloud web service has been determined. The deployment of the model in the form of automated technology based on the Amazon Web Services platform is substantiated. The basis of the automated online fraud detection system is Amazon Fraud Detector and setting up payment fraud detection workflows in payment systems using a customizable Amazon A2I task type to verify and confirm high-risk forecasts. The paper gives an example of creating an anomaly detection system on Amazon DynamoDB streams using Amazon SageMaker, AWS Glue and AWS Lambda. The automated system takes into account the dynamics of the data set, as the AWS Lambda function also works with many other AWS streaming services. There are three main tasks that the software product solves: prevention and detection of fraud in payment systems, rapid fraud detection (counts in minutes), integration of the software product into the business where payment systems and services are used (for example, payment integration services in financial institutions, online stores, logistics companies, insurance policies, trading platforms, etc.). It is determined that the implementation of an automated system should be considered as a project. The principles of project implementation are offered. It is established that for the rational implementation of the project it is necessary to develop a specific methodology for the implementation of the software product for fraud detection in payment systems of business institutions.

scholarly journals Credit Card Fraud Detection through Parenclitic Network Analysis

Complexity ◽  
2018 ◽  
Vol 2018 ◽  
pp. 1-9 ◽  
Author(s):  
Massimiliano Zanin ◽  
Miguel Romance ◽  
Santiago Moral ◽  
Regino Criado
Keyword(s):  
Data Mining ◽  
Complex Network ◽  
Credit Card ◽  
Reference Group ◽  
Detection System ◽  
Fraud Detection ◽  
Data Representation ◽  
Classification Algorithm ◽  
Data Set ◽  
Economic Implications

The detection of frauds in credit card transactions is a major topic in financial research, of profound economic implications. While this has hitherto been tackled through data analysis techniques, the resemblances between this and other problems, like the design of recommendation systems and of diagnostic/prognostic medical tools, suggest that a complex network approach may yield important benefits. In this paper we present a first hybrid data mining/complex network classification algorithm, able to detect illegal instances in a real card transaction data set. It is based on a recently proposed network reconstruction algorithm that allows creating representations of the deviation of one instance from a reference group. We show how the inclusion of features extracted from the network data representation improves the score obtained by a standard, neural network-based classification algorithm and additionally how this combined approach can outperform a commercial fraud detection system in specific operation niches. Beyond these specific results, this contribution represents a new example on how complex networks and data mining can be integrated as complementary tools, with the former providing a view to data beyond the capabilities of the latter.

scholarly journals Fraudulent Democracy? An Analysis of Argentina's Infamous Decade Using Supervised Machine Learning

2011 ◽  
Vol 19 (4) ◽  
pp. 409-433 ◽  
Author(s):  
Francisco Cantú ◽  
Sebastián M. Saiegh
Keyword(s):  
Learning Algorithm ◽  
Detection System ◽  
Synthetic Data ◽  
Fraud Detection ◽  
Supervised Machine Learning ◽  
Data Set ◽  
Electoral Fraud ◽  
History Of ◽  
Historical Accounts ◽  
Authentic Data

In this paper, we introduce an innovative method to diagnose electoral fraud using vote counts. Specifically, we use synthetic data to develop and train a fraud detection prototype. We employ a naive Bayes classifier as our learning algorithm and rely on digital analysis to identify the features that are most informative about class distinctions. To evaluate the detection capability of the classifier, we use authentic data drawn from a novel data set of district-level vote counts in the province of Buenos Aires (Argentina) between 1931 and 1941, a period with a checkered history of fraud. Our results corroborate the validity of our approach: The elections considered to be irregular (legitimate) by most historical accounts are unambiguously classified as fraudulent (clean) by the learner. More generally, our findings demonstrate the feasibility of generating and using synthetic data for training and testing an electoral fraud detection system.

scholarly journals An approach to benchmark fraud detection algorithms in the COVID-19 era

2021 ◽  
Author(s):  
Miroslawa Alunowska Figueroa ◽  
Daniel Turner-Szymkiewicz ◽  
Edgar Alonso Lopez-Rojas ◽  
Juan Sebastián Cárdenas-Rodriguez ◽  
Ulf Norinder
Keyword(s):  
Machine Learning ◽  
Data Analysis ◽  
Financial Institutions ◽  
Detection System ◽  
Synthetic Data ◽  
Fraud Detection ◽  
Financial Crime ◽  
Innocent People ◽  
Detection Algorithms ◽  
Digital Payments

To address the challenges in the fight against financial crime, particularly in the COVID-19 pandemic context, this paper focuses on financial synthetic data and the use of a reliable benchmark tool to test fraud detection algorithms. Compliance departments at financial institutions face the challenge of reducing the number of innocent people erroneously accused of fraud. To cope with this problem financial institutions are exploring the application of machine learning fraud detection algorithms and data analysis technologies to develop a more accurate and precise fraud detection system. However, approaches to streamlining and automating banks’ monitoring and testing processes is challenging as there is no consensus on a benchmark. We explore the relevance of measuring the applicability of a financial crime benchmark in the presence of a growing digital financial sector, such as in the case of Mexico. This study is particularly important due to serious threats that are faced by a rapidly developing financial system (2019 Mexican Central Bank Report). These risks have been further exacerbated as a result of the COVID-19 pandemic accelerating the shift towards digital payments.

scholarly journals Credit Card Fraud Detection System Using Machine Learning

2021 ◽  
Vol 13 (4) ◽  
pp. 24-37
Author(s):  
Angela Makolo ◽  
◽  
Tayo Adeboye
Keyword(s):  
Machine Learning ◽  
Credit Card ◽  
Performance Metrics ◽  
Detection System ◽  
Fraud Detection ◽  
Support Vector ◽  
Multivariate Normal ◽  
Data Set ◽  
Credit Card Fraud ◽  
Key Factor

The security of any system is a key factor toward its acceptability by the general public. We propose an intuitive approach to fraud detection in financial institutions using machine learning by designing a Hybrid Credit Card Fraud Detection (HCCFD) system which uses the technique of anomaly detection by applying genetic algorithm and multivariate normal distribution to identify fraudulent transactions on credit cards. An imbalance dataset of credit card transactions was used to the HCCFD and a target variable which indicates whether a transaction is deceitful or otherwise. Using F-score as performance metrics, the model was tested and it gave a prediction accuracy of 93.5%, as against artificial neural network, decision tree and support vector machine, which scored 84.2%, 80.0% and 68.5% respectively, when trained on the same data set. The results obtained showed a significant improvement as compared with the other widely used algorithms.

scholarly journals Multilevel Fraud Detection System using Voting Techniques

2019 ◽  
Vol 8 (12) ◽  
pp. 1805-1811
Keyword(s):  
Data Mining ◽  
Feature Selection ◽  
Detection System ◽  
Fraud Detection ◽  
Classification Algorithms ◽  
Traffic Patterns ◽  
Security Systems ◽  
Data Set ◽  
Classification Techniques ◽  
Best First Search

Fraud detection is an enduring topic that pose a threat to the information security systems. Data mining helps detect and rapidly identify fraud and take instant action to reduce losses. It analysis the various forms of attacks through classifications algorithms of data mining. In this dissertation the data set of NSL-KDD is examined in identifying anomalies in network traffic patterns and the importance of various classification techniques is studied. Firstly the data is classify in two classes Normal and Anomaly and after then the anomaly data categories in various Attack forms i.e Probe, U2R, R2L, DOS to detect the fraud. The analysis performed through feature selection and classification techniques present in WEKA tool of data mining. The features are extracted through feature selection (CfsSubsetEval, InfoGain, FilterSubsetEval and FilterAttributeEval) methods from 41 attributes to 11 attributes using CfsSubsetEval with best first Search and after extraction the features the classification algorithms(Naïve Bayes, RC, RT, RF and DT) applied for finding Accuracy. The best Result in terms of Accuracy is finding through the voting method using Random Committee and Random Forest is 99.94%.

Payment Habits as a Determinant of Retail Payment Innovations Diffusion: the Case of Poland

2013 ◽  
Vol 1 (2) ◽  
pp. 86-102 ◽  
Author(s):  
Janina Harasim ◽  
Monika Klimontowicz
Keyword(s):  
Financial Institutions ◽  
Success Factors ◽  
Market Development ◽  
Opportunities To Learn ◽  
Payment Systems ◽  
Global Trends ◽  
Innovative Methods ◽  
Preferred Providers ◽  
Polish Experience ◽  
Empirical Foundation

New and innovative methods for electronic funds transfer are emerging globally. These new payment tools include extensions of the established payment systems as well as new payment methods that are substantially different from traditional transactions. They have made the retail payments faster, cheaper, easier and more convenient for customers. Simultaneously, these payment innovations influence retail payment market around the world. During the last few decades it has changed remarkably and has become a very competitive one. Financial institutions are increasingly in competition with technology companies and other organizations to be the preferred providers of consumer payment services. There are huge differences between retail payment markets in developing countries and those in the mature markets. Payment habits are mostly influenced by local cultural drivers, so global trends are few and far between. Nevertheless, as consumer expectations and habits are becoming more homogenized and financial institutions start to be interested in new markets, the opportunities to learn from the experiences of other economies appear. The paper discusses theoretical and empirical foundation of retail payment innovations diffusion, presents the retail payment taxonomy and the results of a survey held in Poland in 2013. It is concluded that Polish experience can be assessed as a benchmark for searching determinants of retail payment markets development. However, copying success factors for sustainable market development is rather impossible with regard to payment culture, experiences and habits.

Automated system for creating training programs for mass professional users

2020 ◽  
pp. 21-27
Author(s):  
V.K. Grigoriev ◽  
A.A. Biryukova ◽  
A. Yu. Volk ◽  
A.S. Ilyushechkin
Keyword(s):  
Experimental Verification ◽  
Training Programs ◽  
Automated System ◽  
Software Product ◽  
Learning Programs ◽  
E Learning ◽  
The Creation ◽  
The Impact

The article discusses the automation of the creation and use of e-learning programs. The impact of automating the learning of a large number of users on the effectiveness of the introduction of a new software product is analyzed. The methods and algorithms that increase the efficiency of creating electronic training programs on example of the author’s automated system “Tutor Builder” are described. The results of experimental verification of the automated system are provided.

scholarly journals An intelligent payment card fraud detection system

2021 ◽  
Author(s):  
Manjeevan Seera ◽  
Chee Peng Lim ◽  
Ajay Kumar ◽  
Lalitha Dhamotharan ◽  
Kim Hua Tan
Keyword(s):  
Detection System ◽  
Fraud Detection ◽  
Payment Card

scholarly journals An automated system analysis and design tool for spacecrafts ceas space journal

2021 ◽  
Author(s):  
Manfred Ehresmann ◽  
Georg Herdrich ◽  
Stefanos Fasoulas
Keyword(s):  
Evolutionary Algorithms ◽  
Evolutionary Algorithm ◽  
Degrees Of Freedom ◽  
System Analysis ◽  
Propulsion System ◽  
Optimal System ◽  
Automated System ◽  
Processing Unit ◽  
Data Set ◽  
Analysis And Design

AbstractIn this paper, a generic full-system estimation software tool is introduced and applied to a data set of actual flight missions to derive a heuristic for system composition for mass and power ratios of considered sub-systems. The capability of evolutionary algorithms to analyse and effectively design spacecraft (sub-)systems is shown. After deriving top-level estimates for each spacecraft sub-system based on heuristic heritage data, a detailed component-based system analysis follows. Various degrees of freedom exist for a hardware-based sub-system design; these are to be resolved via an evolutionary algorithm to determine an optimal system configuration. A propulsion system implementation for a small satellite test case will serve as a reference example of the implemented algorithm application. The propulsion system includes thruster, power processing unit, tank, propellant and general power supply system masses and power consumptions. Relevant performance parameters such as desired thrust, effective exhaust velocity, utilised propellant, and the propulsion type are considered as degrees of freedom. An evolutionary algorithm is applied to the propulsion system scaling model to demonstrate that such evolutionary algorithms are capable of bypassing complex multidimensional design optimisation problems. An evolutionary algorithm is an algorithm that uses a heuristic to change input parameters and a defined selection criterion (e.g., mass fraction of the system) on an optimisation function to refine solutions successively. With sufficient generations and, thereby, iterations of design points, local optima are determined. Using mitigation methods and a sufficient number of seed points, a global optimal system configurations can be found.

scholarly journals Training and deploying a deep learning model for endoscopic severity grading in ulcerative colitis using multicenter clinical trial data

2021 ◽  
Vol 14 ◽  
pp. 263177452199062
Author(s):  
Benjamin Gutierrez Becker ◽  
Filippo Arcadu ◽  
Andreas Thalhammer ◽  
Citlalli Gamez Serna ◽  
Owen Feehan ◽  
...  
Keyword(s):  
Artificial Intelligence ◽  
Ulcerative Colitis ◽  
Clinical Trials ◽  
Deep Learning ◽  
Mayo Clinic ◽  
Automated System ◽  
Phase Iii ◽  
Plain Language ◽  
Data Set ◽  
Endoscopic Videos

Introduction: The Mayo Clinic Endoscopic Subscore is a commonly used grading system to assess the severity of ulcerative colitis. Correctly grading colonoscopies using the Mayo Clinic Endoscopic Subscore is a challenging task, with suboptimal rates of interrater and intrarater variability observed even among experienced and sufficiently trained experts. In recent years, several machine learning algorithms have been proposed in an effort to improve the standardization and reproducibility of Mayo Clinic Endoscopic Subscore grading. Methods: Here we propose an end-to-end fully automated system based on deep learning to predict a binary version of the Mayo Clinic Endoscopic Subscore directly from raw colonoscopy videos. Differently from previous studies, the proposed method mimics the assessment done in practice by a gastroenterologist, that is, traversing the whole colonoscopy video, identifying visually informative regions and computing an overall Mayo Clinic Endoscopic Subscore. The proposed deep learning–based system has been trained and deployed on raw colonoscopies using Mayo Clinic Endoscopic Subscore ground truth provided only at the colon section level, without manually selecting frames driving the severity scoring of ulcerative colitis. Results and Conclusion: Our evaluation on 1672 endoscopic videos obtained from a multisite data set obtained from the etrolizumab Phase II Eucalyptus and Phase III Hickory and Laurel clinical trials, show that our proposed methodology can grade endoscopic videos with a high degree of accuracy and robustness (Area Under the Receiver Operating Characteristic Curve = 0.84 for Mayo Clinic Endoscopic Subscore ⩾ 1, 0.85 for Mayo Clinic Endoscopic Subscore ⩾ 2 and 0.85 for Mayo Clinic Endoscopic Subscore ⩾ 3) and reduced amounts of manual annotation. Plain language summary Patient, caregiver and provider thoughts on educational materials about prescribing and medication safety Artificial intelligence can be used to automatically assess full endoscopic videos and estimate the severity of ulcerative colitis. In this work, we present an artificial intelligence algorithm for the automatic grading of ulcerative colitis in full endoscopic videos. Our artificial intelligence models were trained and evaluated on a large and diverse set of colonoscopy videos obtained from concluded clinical trials. We demonstrate not only that artificial intelligence is able to accurately grade full endoscopic videos, but also that using diverse data sets obtained from multiple sites is critical to train robust AI models that could potentially be deployed on real-world data.

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