Leveraging Machine Learning and Artificial Intelligence for Fraud Prevention

International Journal of Computer Science and Engineering
© 2023 by SSRG - IJCSE Journal
Volume 10 Issue 5
Year of Publication : 2023
Authors : Pankaj Gupta

pdf
How to Cite?

Pankaj Gupta, "Leveraging Machine Learning and Artificial Intelligence for Fraud Prevention," SSRG International Journal of Computer Science and Engineering , vol. 10,  no. 5, pp. 47-52, 2023. Crossref, https://doi.org/10.14445/23488387/IJCSE-V10I5P107

Abstract:

Fraud remains a pervasive global issue, affecting individuals and organizations alike. In the modern technology-driven landscape, the role of machine learning (ML) and artificial intelligence (AI) has become paramount in combating fraud across various sectors. This article critically examines traditional fraud prevention methods, highlighting their limitations in the face of ever-evolving fraudulent tactics. It further explores how ML and AI technologies revolutionise fraud prevention efforts by facilitating rapid digitalization. By harnessing the power of ML algorithms and AI techniques, organizations can effectively analyze massive volumes of data, uncover patterns, and identify abnormal behaviors that often signify fraudulent activities. This article delves into the invaluable role played by ML and AI in augmenting fraud prevention through advanced data analytics, anomaly detection, and predictive modeling. It emphasizes how these technologies enable organizations to detect and mitigate fraud risks proactively, thus safeguarding their operations and stakeholders.

Keywords:

Artificial Intelligence, Data Lake, Fraud, Machine Learning, Models, Real Time Monitoring.

References:

[1] Association of Fraud Examiner. [Online]. Available: https://www.acfe.com/fraud-resources/fraud-101-what-is-fraud
[2] Alicja Grzadkowska, Global Interconnectivity is Spreading Major Risks Around the World, 2019. [Online] Available: https://www.insurancebusinessmag.com/us/news/breaking-news/global-interconnectivity-is-spreading-major-risks-around-the-world-158205.aspx
[3] Federal Trade Commission Report 2022. [Online]. Available: https://www.ftc.gov/news-events/news/press-releases/2023/02/new-ftc-data-show-consumers-reported-losing-nearly-88-billion-scams-2022
[4] Annual Data Breach Report by The Identity Theft Research Center.[Online]. Available: https://www.idtheftcenter.org/publication/2022-data-breach-report/
[5] Financial Frauds and Its Economic Implication by Piyush Vidyarthi, 2020. [Online]. Available:
https://www.linkedin.com/pulse/financial-frauds-its-economic-implication-piyush-vidyarthi/
[6] Teun de Planque, Big Data: Computer vs. Human Brain, 2017. [Online]. Available: https://mse238blog.stanford.edu/2017/07/teun/big-data-computer-vs-human-brain/
[7] Eray Eliaçık, Aritificial Intelligence vs. Human Intelligence: Can a Game-changing Technology Play the Game, 2022. [Online] Available: https://dataconomy.com/2022/04/20/is-artificial-intelligence-better-than-human-intelligence/
[8] Pwint Phyu Khine, and Zhao Shun Wang, “Data Lake: A New Ideology in Big Data Era,” 4th Annual International Conference on Wireless Communication and Sensor Network, 2018.
[CrossRef] [Google Scholar] [Publisher Link]
[9] G. Adomavicius, and A. Tuzhilin, “Using Data Mining Methods to Build Customer Profiles,” Computer, vol. 34, no. 2, pp. 74-82, 2001.
[CrossRef] [Google Scholar] [Publisher Link]
[10] Tianqi Chen, and Carlos Guestrin, “XGBoost: A Scalable Tree Boosting System,” International Conference on Knowledge Discovery and Data Mining, pp. 784-794, 2016.
[CrossRef] [Google Scholar] [Publisher Link]
[11] Nikolay Manchev, Credit Card Fraud Detection using XGBoost, SMOTE, and Threshold Moving, 2021. [Online] Available: https://www.dominodatalab.com/blog/credit-card-fraud-detection-using-xgboost-smote-and-threshold-moving
[12] Imane Sadgali, Nawal Sael, and Faouzia Benabbou, “Human Behavior Scoring in Credit Card Fraud Detection,” IAES International Journal of Artificial Intelligence, vol. 10, no. 3, pp. 698-706, 2021.
[CrossRef] [Google Scholar] [Publisher Link]
[13] Gary S. Reynolds, “Facial Recognition: A Biometric for The Fight Against Check Fraud,” Journal of Economic Crime Management, vol. 4, no. 2, 2006.
[Google Scholar] [Publisher Link]
[14] Nghia Nguyen et al., “A Proposed Model for Card Fraud Detection Based on CatBoost and Deep Neural Network,” IEEE Access, vol. 10, pp. 96852-96861, 2022.
[CrossRef] [Google Scholar] [Publisher Link]
[15] Google Cloud. [Online]. Available: https://cloud.google.com/learn/what-is-a-data-lake
[16] Data Robot. [Online]. Available: https://www.datarobot.com/wiki/feature/
[17] Eoghan Keany, What makes “XGBoost” so Extreme, 2020. [Online]. Available: https://medium.com/analytics-vidhya/what-makes-xgboost-so-extreme-e1544a4433bb
[18] Christian Szegedy, Alexander Toshev, and Dumitru Erhan, “Deep Neural Networks for Object Detection,” Advances in Neural Information Processing Systems, 2013.
[Google Scholar] [Publisher Link]
[19] Deepchecks. [Online]. Available: https://deepchecks.com/glossary/gaussian-distribution/
[20] Z. Ferdousi, and A. Maeda, “Unsupervised Outlier Detection in Time Series Data,” 22nd International Conference on Data Engineering Workshops, 2006.
[CrossRef] [Google Scholar] [Publisher Link]
[21] Lindsay C.J. Mercer, “Fraud Detection Via Regression Analysis,” Computer and Security, vol. 9, no. 4, pp. 331-338, 1990.
[CrossRef] [Google Scholar] [Publisher Link]
[22] Phuong Hanh Tran et al., “Blockchain and Machine Learning Approaches for Credit Card Fraud Detection,” Proceedings of the 2018 International Conference on E-Business and Applications, pp. 6-9, 2018.
[CrossRef] [Publisher Link]
[23] Marcin Gabryel et al., “Decision making Support System for Managing Advertisers by ad Fraud Detection,” Journal of Artificial Intelligence and Soft Computing Research, pp. 331-339, 2021.
[CrossRef] [Google Scholar] [Publisher Link]
[24] Louis DeNicola, What is Synthetic ID Fraud?, 2021. [Online]. Available: https://www.experian.com/blogs/ask-experian/what-is-synthetic-identity-fraud-theft/#s2
[25] Teradata Corporation. [Online]. Available: https://www.teradata.com/Trends/AI-and-Machine-Learning/Fraud-Detection-Machine-Learning
[26] Intellias. [Online]. Available:
https://intellias.com/how-to-use-machine-learning-in-fraud-detection/#:~:text=Fraud%20detection%20using%20machine%20learning%20can%20solve%20all%20of%20these,its%20models%20and%20patterns%20immediately