1) The document discusses using hidden Markov models to analyze credit card transaction patterns to detect fraudulent activity. It analyzes the spending profiles of cardholders over their last 20 transactions to identify anomalies.
2) The proposed model uses low, medium, and high price ranges to classify transaction amounts and detect deviations from normal spending patterns.
3) The analysis calculates the percentage of transactions in each spending profile category based on past transactions to identify unusual activity. Detecting fraudulent transactions in real-time can prevent further losses.
International Journal of Computational Engineering Research(IJCER) ijceronline
International Journal of Computational Engineering Research(IJCER) is an intentional online Journal in English monthly publishing journal. This Journal publish original research work that contributes significantly to further the scientific knowledge in engineering and Technology.
The credit card has become the most popular mode of payment for both online as well as
regular purchase, in cases of fraud associated with it are also rising. Credit card frauds are increasing
day by day regardless of the various techniques developed for its detection. Fraudsters are so expert that
they generate new ways for committing fraudulent transactions each day which demands constant
innovation for its detection techniques. Most of the techniques based on Artificial Intelligence, Fuzzy
logic, neural network, logistic regression, naïve Bayesian, Machine learning, Sequence Alignment,
decision tree, Bayesian network, meta learning, Genetic Programming etc., these are evolved in
detecting various credit card fraudulent transactions. This paper presents a survey of various techniques
used in credit card fraud detection mechanisms.
A Survey of Online Credit Card Fraud Detection using Data Mining TechniquesIJSRD
Nowadays the use of credit card has increased, because the amount of online transaction is growing. With the day to day use of credit card for payment online as well as regular purchase, case of fraud associated with it is also rising. To reduce the huge financial loss caused by frauds, a number of modern techniques have been developed for fraud detection which is based on data mining, neural network, genetic algorithm etc. Here a survey of techniques for online credit card fraud detection using Hidden Markov Model, Genetic Algorithm and Hybrid Model, and comparison between them has been shown.
The project sets sight on authenticating the conventional Credit card transaction system. In the prevailing system though the Credit card paves a convenient mode of transactions, it is subjected to more jeopardy. As technology extends its limit, the way of hacking and cracking also goes along the road. In out proposed system, in every transaction with the Credit card a handshaking signal is achieved with the cardholder. The handshaking method is achieved by transferring the transaction time and the purchase details to the mobile of the cardholder by means of a GSM modem. From the acknowledgement and authentication received from the cardholder’s mobile further transaction proceeds. The system used the MCU for the security issues between the Mobile and the Card. Reports can also be generated for every successful authentication.
An Enhanced Automated Teller Machine Security Prototype using Fingerprint Bio...Eswar Publications
The steady growth in electronic transactions has promoted the Automated Teller Machine (ATM) thereby making it the main transaction channel for carrying out financial transactions. However, this has also increased the amount of fraudulent activities carried out on Automated Teller Machines (ATMs) thereby calling for efficient security mechanisms and increasing the demand for fast and accurate user identification and
authentication in ATMs. This research analyses, designs and proposes a biometric authentication prototype for integrating fingerprint security with ATMs as an added layer of security. A fingerprint biometric technique was fused with personal identification numbers (PIN's) for authentication to ameliorate the security level. The prototype was simulated using a fingerprint scanner and Java Platform Enterprise Edition was used to develop an ATM application which was used to synchronize with a fingerprint scanner thereby providing a biometric authentication scheme for carrying out transactions on an ATM.
Survey on Credit Card Fraud Detection Using Different Data Mining Techniquesijsrd.com
In today's world of e-commerce, credit card payment is the most popular and most important mean of payment due to fast technology. As the usage of credit card has increased the number of fraud transaction is also increasing. Credit card fraud is very serious and growing problem throughout the world. This paper represents the survey of various fraud detection techniques through which fraud can be detected. Although there are serious fraud detection technology exits based on data mining, knowledge discovery but they are not capable to detect the fraud at a time when fraudulent transaction are in progress so two techniques Neural Network and Hidden Markov Model(HMM) are capable to detect the fraudulent transaction is in progress. HMM categorizes card holder profile as low, medium, and high spending on their spending behavior. A set of probability is assigned to each cardholder for amount of transaction. The amount of incoming transaction is matched with cardholder previous transaction, if it is justified a predefined threshold value then a transaction is considered as a legitimate else it is considered as a fraud.
International Journal of Computational Engineering Research(IJCER) ijceronline
International Journal of Computational Engineering Research(IJCER) is an intentional online Journal in English monthly publishing journal. This Journal publish original research work that contributes significantly to further the scientific knowledge in engineering and Technology.
The credit card has become the most popular mode of payment for both online as well as
regular purchase, in cases of fraud associated with it are also rising. Credit card frauds are increasing
day by day regardless of the various techniques developed for its detection. Fraudsters are so expert that
they generate new ways for committing fraudulent transactions each day which demands constant
innovation for its detection techniques. Most of the techniques based on Artificial Intelligence, Fuzzy
logic, neural network, logistic regression, naïve Bayesian, Machine learning, Sequence Alignment,
decision tree, Bayesian network, meta learning, Genetic Programming etc., these are evolved in
detecting various credit card fraudulent transactions. This paper presents a survey of various techniques
used in credit card fraud detection mechanisms.
A Survey of Online Credit Card Fraud Detection using Data Mining TechniquesIJSRD
Nowadays the use of credit card has increased, because the amount of online transaction is growing. With the day to day use of credit card for payment online as well as regular purchase, case of fraud associated with it is also rising. To reduce the huge financial loss caused by frauds, a number of modern techniques have been developed for fraud detection which is based on data mining, neural network, genetic algorithm etc. Here a survey of techniques for online credit card fraud detection using Hidden Markov Model, Genetic Algorithm and Hybrid Model, and comparison between them has been shown.
The project sets sight on authenticating the conventional Credit card transaction system. In the prevailing system though the Credit card paves a convenient mode of transactions, it is subjected to more jeopardy. As technology extends its limit, the way of hacking and cracking also goes along the road. In out proposed system, in every transaction with the Credit card a handshaking signal is achieved with the cardholder. The handshaking method is achieved by transferring the transaction time and the purchase details to the mobile of the cardholder by means of a GSM modem. From the acknowledgement and authentication received from the cardholder’s mobile further transaction proceeds. The system used the MCU for the security issues between the Mobile and the Card. Reports can also be generated for every successful authentication.
An Enhanced Automated Teller Machine Security Prototype using Fingerprint Bio...Eswar Publications
The steady growth in electronic transactions has promoted the Automated Teller Machine (ATM) thereby making it the main transaction channel for carrying out financial transactions. However, this has also increased the amount of fraudulent activities carried out on Automated Teller Machines (ATMs) thereby calling for efficient security mechanisms and increasing the demand for fast and accurate user identification and
authentication in ATMs. This research analyses, designs and proposes a biometric authentication prototype for integrating fingerprint security with ATMs as an added layer of security. A fingerprint biometric technique was fused with personal identification numbers (PIN's) for authentication to ameliorate the security level. The prototype was simulated using a fingerprint scanner and Java Platform Enterprise Edition was used to develop an ATM application which was used to synchronize with a fingerprint scanner thereby providing a biometric authentication scheme for carrying out transactions on an ATM.
Survey on Credit Card Fraud Detection Using Different Data Mining Techniquesijsrd.com
In today's world of e-commerce, credit card payment is the most popular and most important mean of payment due to fast technology. As the usage of credit card has increased the number of fraud transaction is also increasing. Credit card fraud is very serious and growing problem throughout the world. This paper represents the survey of various fraud detection techniques through which fraud can be detected. Although there are serious fraud detection technology exits based on data mining, knowledge discovery but they are not capable to detect the fraud at a time when fraudulent transaction are in progress so two techniques Neural Network and Hidden Markov Model(HMM) are capable to detect the fraudulent transaction is in progress. HMM categorizes card holder profile as low, medium, and high spending on their spending behavior. A set of probability is assigned to each cardholder for amount of transaction. The amount of incoming transaction is matched with cardholder previous transaction, if it is justified a predefined threshold value then a transaction is considered as a legitimate else it is considered as a fraud.
Software for Payment Cards: Choosing WiselyCognizant
As the use of card-based payments continues to grow, financial institutions must improve their response times, strengthen their security, hone their future-readiness and enrich their business value. When selecting a commercial off-the-shelf (COTS) solution, banks must verify that the product and its support services are equipped to accommodate short and long-term business and IT objectives.
Shopify makes it easy for you to choose the right payment methods that are the perfect fit for your customers. Below are some of the critical points to keep in mind before you hire a Shopify development agency that can deliver as per your needs.
To know more visit at https://www.thinktanker.io/blog/seamless-payment-integration-with-shopify.html
What payment is? What Payment Gateway/ Payment aggregator is?
How PG/Aggregator to be selected/charges/make money?MID & LiveID. What is Transaction, Refund? What are the Risk their understanding? What are Payment Pages, how to save cards, transaction routing & integration?
E Payment System Introduction Of Large Value Payment SystemHai Vu
- Basic concept of the Inter Bank Payment System.
- Explain on the basics of Real Time Settlement System.
- Payment system in Vietnam.
- Payment system in Nigeria
- Current trend of the Large Value Payment System using other settlement method.
Frauds in Indian Banking: Aspects, Reasons, Trend-Analysis and Suggestive Mea...inventionjournals
Frauds (basis amount of money involved) in Indian banking have seen a rising trend over the last few years. The statement is just basis the cases reported by member banks in India; the unreported figures could be still higher. Against this backdrop and coupled with rising NPAs and more usage of alternate technological modes of baking, it is essential that banks relook at the time and amount of attention that they normally have been giving to frauds and proactive measures to prevent the same. This paper discusses the various aspects of frauds in Indian banking system. It evaluates the statistics involved with fraud basis secondary data available from reliable sources and also analyses the same. Each of the types namely KYC related, loan related and technological aspects are discussed in details along with the reasons. At the end, some suggestions are placed for banks to practice.
The vast spreading of information in the last decade has led to great development in e-commerce. For instance, e-trade and e-bank are two main Internet services that implement e-transaction from anyplace in the world. This helps merchant and bank to ease the financial transaction process and to give user friendly services at any time. However, the cost of workers and communications falls down considerably while the cost of trusted authority and protecting information is increased. E-payment is now one of the most central research areas in e-commerce, mainly regarding online and offline payment scenarios. In this paper, we will discuss an important e-payment protocol namely Kim and Lee scheme examine its advantages and delimitations, which encourages the author to develop more efficient scheme that keeping all characteristics intact without concession of the security robustness of the protocol. The suggest protocol employs the idea of public key encryption scheme using the thought of hash chain. We will compare the proposed protocol with Kim and Lee protocol and demonstrate that the proposed protocol offers more security and efficiency, which makes the protocol workable for real world services.
Std 12 Computer Chapter 5 Introduction to Mcommerce (Part 3 Electronic Payment System)
Payment in Ecommerce/Mcommerce
Traditional vs. Electronic Payment System
Credit Card
Debit Card
Smart Card
Charge Card
Net Banking
Electronic Fund Transfer (EFT)
E-Wallet
RuPay
Understanding the Card Fraud Lifecycle : A Guide For Private Label IssuersChristopher Uriarte
With credit card fraud dramatically on the rise, particularly in the form of card-not-present (CNP) fraud across Internet and Mail Order/Telephone Order (MOTO) channels, it is important for private label issuers to understand the depth of this problem and how it affects their merchant portfolio and their ability to accept private label cards. Private label cards were often considered to be “low risk”, relative to traditional bank cards, but our current analysis has shown the contrary: fraudsters are increasingly using private label cards as the payment instrument in CNP channels and merchants are at great risk if specific strategies are not put in place to stop it.
IOSR Journal of Applied Physics (IOSR-JAP) is an open access international journal that provides rapid publication (within a month) of articles in all areas of physics and its applications. The journal welcomes publications of high quality papers on theoretical developments and practical applications in applied physics. Original research papers, state-of-the-art reviews, and high quality technical notes are invited for publications.
Software for Payment Cards: Choosing WiselyCognizant
As the use of card-based payments continues to grow, financial institutions must improve their response times, strengthen their security, hone their future-readiness and enrich their business value. When selecting a commercial off-the-shelf (COTS) solution, banks must verify that the product and its support services are equipped to accommodate short and long-term business and IT objectives.
Shopify makes it easy for you to choose the right payment methods that are the perfect fit for your customers. Below are some of the critical points to keep in mind before you hire a Shopify development agency that can deliver as per your needs.
To know more visit at https://www.thinktanker.io/blog/seamless-payment-integration-with-shopify.html
What payment is? What Payment Gateway/ Payment aggregator is?
How PG/Aggregator to be selected/charges/make money?MID & LiveID. What is Transaction, Refund? What are the Risk their understanding? What are Payment Pages, how to save cards, transaction routing & integration?
E Payment System Introduction Of Large Value Payment SystemHai Vu
- Basic concept of the Inter Bank Payment System.
- Explain on the basics of Real Time Settlement System.
- Payment system in Vietnam.
- Payment system in Nigeria
- Current trend of the Large Value Payment System using other settlement method.
Frauds in Indian Banking: Aspects, Reasons, Trend-Analysis and Suggestive Mea...inventionjournals
Frauds (basis amount of money involved) in Indian banking have seen a rising trend over the last few years. The statement is just basis the cases reported by member banks in India; the unreported figures could be still higher. Against this backdrop and coupled with rising NPAs and more usage of alternate technological modes of baking, it is essential that banks relook at the time and amount of attention that they normally have been giving to frauds and proactive measures to prevent the same. This paper discusses the various aspects of frauds in Indian banking system. It evaluates the statistics involved with fraud basis secondary data available from reliable sources and also analyses the same. Each of the types namely KYC related, loan related and technological aspects are discussed in details along with the reasons. At the end, some suggestions are placed for banks to practice.
The vast spreading of information in the last decade has led to great development in e-commerce. For instance, e-trade and e-bank are two main Internet services that implement e-transaction from anyplace in the world. This helps merchant and bank to ease the financial transaction process and to give user friendly services at any time. However, the cost of workers and communications falls down considerably while the cost of trusted authority and protecting information is increased. E-payment is now one of the most central research areas in e-commerce, mainly regarding online and offline payment scenarios. In this paper, we will discuss an important e-payment protocol namely Kim and Lee scheme examine its advantages and delimitations, which encourages the author to develop more efficient scheme that keeping all characteristics intact without concession of the security robustness of the protocol. The suggest protocol employs the idea of public key encryption scheme using the thought of hash chain. We will compare the proposed protocol with Kim and Lee protocol and demonstrate that the proposed protocol offers more security and efficiency, which makes the protocol workable for real world services.
Std 12 Computer Chapter 5 Introduction to Mcommerce (Part 3 Electronic Payment System)
Payment in Ecommerce/Mcommerce
Traditional vs. Electronic Payment System
Credit Card
Debit Card
Smart Card
Charge Card
Net Banking
Electronic Fund Transfer (EFT)
E-Wallet
RuPay
Understanding the Card Fraud Lifecycle : A Guide For Private Label IssuersChristopher Uriarte
With credit card fraud dramatically on the rise, particularly in the form of card-not-present (CNP) fraud across Internet and Mail Order/Telephone Order (MOTO) channels, it is important for private label issuers to understand the depth of this problem and how it affects their merchant portfolio and their ability to accept private label cards. Private label cards were often considered to be “low risk”, relative to traditional bank cards, but our current analysis has shown the contrary: fraudsters are increasingly using private label cards as the payment instrument in CNP channels and merchants are at great risk if specific strategies are not put in place to stop it.
IOSR Journal of Applied Physics (IOSR-JAP) is an open access international journal that provides rapid publication (within a month) of articles in all areas of physics and its applications. The journal welcomes publications of high quality papers on theoretical developments and practical applications in applied physics. Original research papers, state-of-the-art reviews, and high quality technical notes are invited for publications.
Problem Reduction in Online Payment System Using Hybrid ModelIJMIT JOURNAL
Online auction, shopping, electronic billing etc. all such types of application involves problems of fraudulent transactions. Online fraud occurrence and its detection is one of the challenging fields for web development and online phantom transaction. As no-secure specification of online frauds is in research database, so the techniques to evaluate and stop them are also in study. We are providing an approach with Hidden Markov Model (HMM) and mobile implicit authentication to find whether the user interacting online is a fraud or not. We propose a model based on these approaches to counter the occurred fraud and prevent the loss of the customer. Our technique is more parameterized than traditional approaches and so, chances of detecting legitimate user as a fraud will reduce.
Billions of dollars of loss are caused every year by fraudulent credit card transactions. The design of efficient fraud detection algorithms is key for reducing these losses, and more and more algorithms rely on advanced machine learning techniques to assist fraud investigators. The design of fraud detection algorithms is however particularly challenging due to the non-stationary distribution of the data, the highly unbalanced classes distributions and the availability of few transactions labeled by fraud investigators. At the same time public data are scarcely available for confidentiality issues, leaving unanswered many questions about what is the best strategy. In this thesis we aim to provide some answers by focusing on crucial issues such as: i) why and how under sampling is useful in the presence of class imbalance (i.e. frauds are a small percentage of the transactions), ii) how to deal with unbalanced and evolving data streams (non-stationarity due to fraud evolution and change of spending behavior), iii) how to assess performances in a way which is relevant for detection and iv) how to use feedbacks provided by investigators on the fraud alerts generated. Finally, we design and assess a prototype of a Fraud Detection System able to meet real-world working conditions and that is able to integrate investigators’ feedback to generate accurate alerts.
Online Transaction Fraud Detection using Hidden Markov Model & Behavior AnalysisCSCJournals
Card payment are mostly preferred by many for transactions instead of cash. Due to its convenience, it is the most accepted payment method for offline as well as online purchases, irrespective of region or country the purchase is made. Currently, cards are used for everyday activities, such as online shopping, bill pays, subscriptions, etc. Consequently, there are more chances of fraudulent transactions. Online transactions are the prime target as it does not require real card, only card details are enough and can be stored digitally. The current system detects the fraud transaction after the transaction is completed. Proposed system in this paper, uses Hidden Markov Model (HMM), which is one of the statistical stochastic models used to model randomly changing systems. Using Hidden Markov Model, a fraud transaction can be detected during the time of transaction itself and after 3 attempts of verification card can blocked at the same time. Behavior Analysis (BA) helps to understand the spending habits of cardholder. Hidden Markov Model helps to acquire high-level fraud analysis with a low false alarm ratio.
Secure Payments: How Card Issuers and Merchants Can Stay Ahead of FraudstersCognizant
Our latest research reveals that merchants and card issuers should take a layered approach to mitigating risk, by working with consumers to improve fraud detection and prevention.
Pushing the limits of ePRTC: 100ns holdover for 100 daysAdtran
At WSTS 2024, Alon Stern explored the topic of parametric holdover and explained how recent research findings can be implemented in real-world PNT networks to achieve 100 nanoseconds of accuracy for up to 100 days.
GraphSummit Singapore | The Future of Agility: Supercharging Digital Transfor...Neo4j
Leonard Jayamohan, Partner & Generative AI Lead, Deloitte
This keynote will reveal how Deloitte leverages Neo4j’s graph power for groundbreaking digital twin solutions, achieving a staggering 100x performance boost. Discover the essential role knowledge graphs play in successful generative AI implementations. Plus, get an exclusive look at an innovative Neo4j + Generative AI solution Deloitte is developing in-house.
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Today, after several years of existence, an extremely active community and an ultra-dynamic ecosystem, Kubernetes has established itself as the de facto standard in container orchestration. Thanks to a wide range of managed services, it has never been so easy to set up a ready-to-use Kubernetes cluster.
However, this ease of use means that the subject of security in Kubernetes is often left for later, or even neglected. This exposes companies to significant risks.
In this talk, I'll show you step-by-step how to secure your Kubernetes cluster for greater peace of mind and reliability.
Dr. Sean Tan, Head of Data Science, Changi Airport Group
Discover how Changi Airport Group (CAG) leverages graph technologies and generative AI to revolutionize their search capabilities. This session delves into the unique search needs of CAG’s diverse passengers and customers, showcasing how graph data structures enhance the accuracy and relevance of AI-generated search results, mitigating the risk of “hallucinations” and improving the overall customer journey.
The Art of the Pitch: WordPress Relationships and SalesLaura Byrne
Clients don’t know what they don’t know. What web solutions are right for them? How does WordPress come into the picture? How do you make sure you understand scope and timeline? What do you do if sometime changes?
All these questions and more will be explored as we talk about matching clients’ needs with what your agency offers without pulling teeth or pulling your hair out. Practical tips, and strategies for successful relationship building that leads to closing the deal.
A tale of scale & speed: How the US Navy is enabling software delivery from l...sonjaschweigert1
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- Reduction in onboarding time from 5 weeks to 1 day
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- Maintenance of superior security standards and inherent policy enforcement with Authorization to Operate (ATO)
Development teams can ship efficiently and ensure applications are cyber ready for Navy Authorizing Officials (AOs). In this webinar, Sigma Defense and Anchore will give attendees a look behind the scenes and demo secure pipeline automation and security artifacts that speed up application ATO and time to production.
We will cover:
- How to remove silos in DevSecOps
- How to build efficient development pipeline roles and component templates
- How to deliver security artifacts that matter for ATO’s (SBOMs, vulnerability reports, and policy evidence)
- How to streamline operations with automated policy checks on container images
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• What is SAP Fiori and why it matters to you
• How a better user experience drives measurable business benefits
• How to get started with SAP Fiori today
• How SAP Fiori elements accelerates application development
• How SAP Build Code includes SAP Fiori tools and other generative artificial intelligence capabilities
• How SAP Fiori paves the way for using AI in SAP apps
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Communications Mining Series - Zero to Hero - Session 1DianaGray10
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• Communication Mining Overview
• Why is it important?
• How can it help today’s business and the benefits
• Phases in Communication Mining
• Demo on Platform overview
• Q/A
UiPath Test Automation using UiPath Test Suite series, part 4DianaGray10
Welcome to UiPath Test Automation using UiPath Test Suite series part 4. In this session, we will cover Test Manager overview along with SAP heatmap.
The UiPath Test Manager overview with SAP heatmap webinar offers a concise yet comprehensive exploration of the role of a Test Manager within SAP environments, coupled with the utilization of heatmaps for effective testing strategies.
Participants will gain insights into the responsibilities, challenges, and best practices associated with test management in SAP projects. Additionally, the webinar delves into the significance of heatmaps as a visual aid for identifying testing priorities, areas of risk, and resource allocation within SAP landscapes. Through this session, attendees can expect to enhance their understanding of test management principles while learning practical approaches to optimize testing processes in SAP environments using heatmap visualization techniques
What will you get from this session?
1. Insights into SAP testing best practices
2. Heatmap utilization for testing
3. Optimization of testing processes
4. Demo
Topics covered:
Execution from the test manager
Orchestrator execution result
Defect reporting
SAP heatmap example with demo
Speaker:
Deepak Rai, Automation Practice Lead, Boundaryless Group and UiPath MVP
State of ICS and IoT Cyber Threat Landscape Report 2024 previewPrayukth K V
The IoT and OT threat landscape report has been prepared by the Threat Research Team at Sectrio using data from Sectrio, cyber threat intelligence farming facilities spread across over 85 cities around the world. In addition, Sectrio also runs AI-based advanced threat and payload engagement facilities that serve as sinks to attract and engage sophisticated threat actors, and newer malware including new variants and latent threats that are at an earlier stage of development.
The latest edition of the OT/ICS and IoT security Threat Landscape Report 2024 also covers:
State of global ICS asset and network exposure
Sectoral targets and attacks as well as the cost of ransom
Global APT activity, AI usage, actor and tactic profiles, and implications
Rise in volumes of AI-powered cyberattacks
Major cyber events in 2024
Malware and malicious payload trends
Cyberattack types and targets
Vulnerability exploit attempts on CVEs
Attacks on counties – USA
Expansion of bot farms – how, where, and why
In-depth analysis of the cyber threat landscape across North America, South America, Europe, APAC, and the Middle East
Why are attacks on smart factories rising?
Cyber risk predictions
Axis of attacks – Europe
Systemic attacks in the Middle East
Download the full report from here:
https://sectrio.com/resources/ot-threat-landscape-reports/sectrio-releases-ot-ics-and-iot-security-threat-landscape-report-2024/
Why You Should Replace Windows 11 with Nitrux Linux 3.5.0 for enhanced perfor...SOFTTECHHUB
The choice of an operating system plays a pivotal role in shaping our computing experience. For decades, Microsoft's Windows has dominated the market, offering a familiar and widely adopted platform for personal and professional use. However, as technological advancements continue to push the boundaries of innovation, alternative operating systems have emerged, challenging the status quo and offering users a fresh perspective on computing.
One such alternative that has garnered significant attention and acclaim is Nitrux Linux 3.5.0, a sleek, powerful, and user-friendly Linux distribution that promises to redefine the way we interact with our devices. With its focus on performance, security, and customization, Nitrux Linux presents a compelling case for those seeking to break free from the constraints of proprietary software and embrace the freedom and flexibility of open-source computing.
Why You Should Replace Windows 11 with Nitrux Linux 3.5.0 for enhanced perfor...
J017216164
1. IOSR Journal of Computer Engineering (IOSR-JCE)
e-ISSN: 2278-0661,p-ISSN: 2278-8727, Volume 17, Issue 2, Ver. 1 (Mar – Apr. 2015), PP 61-64
www.iosrjournals.org
DOI: 10.9790/0661-17216164 www.iosrjournals.org 61 | Page
Analysis of Spending Pattern on Credit Card Fraud Detection
Capt. Dr. S Santhosh Baboo1
, N Preetha 2
1
Associate Professor, 2
Research Scholar
1,2
Department of Computer Science and Applications
1
D.G.Vaishnav College, Arumbakkam, Chennai,
2
PhD Research Scholar SCSVMV University, Enathur, Kancheepuram
Abstract: Credit card is one of the convenient way of payment in online shopping. In this on line
shopping, payment is made by giving information like card no, security code , expiration date of the
Credit card etc . To rectify the risk factors of using the credit card, every card holder’s spending method
is modeled by using HMM. By using this authenticated security check the information of transaction is
fraudulent or genuine. It is highly secured from unauthorized anomalous user using credit card and avoids
fraud usage of card through online transactions.
Keywords: HMM, FDS, TP, FP
I. Introduction
Now a days, credit card frauds have been rampantly increased, while making e-payments made
for the purchased goods or service provided on internet. These frauds are happening in two types of
purchase using the credit cards. 1) Physical card 2) Virtual card. In this first type of physical card
purchase, the purchaser has to provide the card to a merchant and make payment. In this type , the
credit card fraudulent is happened by stealing the credit card. If the card holder is unaware of this, the
credit card company has to face the financial loss and in the second type of virtual card purchase, the
card holder, has to provide the secret details of the card ( like security code, card no, expiration date
etc.) either thru internet or over phone . Without knowing the consequences, the genuine card holder is
providing the information to the fraudsters. The result is that they loss their money also. To detect this type
of criminal activity , the spending patterns of the card holder is analyzed .
To discover & prevent this type fraudulent activities, some intelligent & effective methods has
been provided by the data mining, machine learning & statistics areas. In these data mining, the cyber
credit card fraud has been detected by using artificial intelligence and algorithms techniques, which
analyses the usage of unusual patterns derived from the data given. In this method, it is detected whether
the transaction is legitimate or illegitimate.
II. Related Work
Ghosh and Reilly [1] have proposed credit card fraud detection with a neural network. They have built
detection system, which is trained on a large sample of labeled credit card account transactions. These
transactions contain example fraud cases due to lost cards, stolen cards, application fraud, counterfeit fraud,
mail-order fraud, and non received issue (NRI) fraud. Stolfo et al [2] suggest a credit card fraud detection
system (FDS) using meta-learning techniques to learn models of fraudulent credit card transactions. Meta
learning is a general strategy that provides a means for combining and integrating a number of separately built
classifiers or models. The same group has also worked on a cost-based model for fraud and intrusion detection
[3]. They use Java agents for Meta-learning (JAM), which is a distributed data mining system for credit card
fraud detection. A number of important performance metrics like TP-FP (True Positive – False Positive) spread
and accuracy have been defined by them.
Aleskerov et al. [4] present CARDWATCH, database mining system used for credit card fraud
detection. The system, based on a neural learning module, provides an interface to a variety of commercial
databases. Fan et al. [5] suggest the application of distributed data mining in credit card fraud detection. Braise
et al. Stolfo use an agent-based approach with distributed learning for detecting frauds in credit card
transactions. It is based on artificial intelligence and combines inductive learning algorithms and metal earning
methods for achieving higher accuracy.
Phua et al. [6] suggest the use of met classifier similar to in fraud detection problems. Recognizing this
problem, the switching-service provider decided to provide a capability to the issuing banks to flag in real-time
those transactions that appeared to be suspicious, and possibly fraudulent. In this way, at the bank’s option,
suspicious or fraudulent transactions were identified and rejected much earlier and faster than previously
possible.
2. Analysis of Spending Pattern on Credit card Fraud Detection
DOI: 10.9790/0661-17216164 www.iosrjournals.org 62 | Page
III. Proposed Work
This work focusing on an application which is used to detect the fraudulent credit card
activities on internet transaction. In this peculiar type, the pattern of current fraudulent usage of the
credit card has been analyzed with the previous transactions, by using the neural networks in algorithm
of data mining.
Figure.1 Proposed Architecture for investigation of credit card.
A. Credit card Fraud Detection using HMM.
To find out the fraudulent transactions, Hidden Markov model is used by detecting and analyzing
the spending profile of the credit card user. generally the profile is being divided into three types a)
lower profile b) middle profile c) higher profile . as every card holder has a different method of
spending profile, This can easily find out fraudulent one by keeping the in consistent record of the
usage of the card. Even though this cannot find out the number of purchased items & its categories,
This identifies the fraudulent transaction easily by analyzing the spending patterns of the card user. in
this the last twenty transactions of card holder can be easily studied & can identify which one is a
fraudulent one (i.e.) the amount, the time of transaction etc. It can be easily noted via the shadow based
replication engine.
The ultimate goal of this analysis is to give a note about the fraudulent transaction, to the
issuing bank and also to the merchant and to take appropriate action by the issuing bank. A critical
problem faced by the issuing banks is that of fraudulent transactions. This problem has, of course, exploded with
the high speed nature of electronic submission of credit and debit transactions. An ATM or POS transaction may
be fraudulent, for instance, if the credit card is stolen. Online purchases may be fraudulent if the credit card
number, expiration date, and CID number are copied from the card. This copying can easily be done, for
example, by a waiter taking a customer’s credit card to pay for a meal or when a phone order is placed and paid
for with a credit card. Identifying fraudulent transactions typically takes hours or days, and many such
transactions may slip through before a hold can be put on the card. Worse, because the information can be
quickly shared with thieves in multiple countries, they can rapidly attack via multiple avenues by submitting
many different types of transactions simultaneously, anticipating that the lesser (slower, etc) infrastructure that
some of them may take will allow at least some of them to get through successfully.
The fraud detection system flags a suspicious transaction with a severity flag and writes this
information to another log. Periodically, the log is sent to the bank’s authorization system, which takes
appropriate action on the card. A credit hold might be placed on the card so that all further transactions will be
rejected until the issue is researched or until the problem is resolved. Alternatively, upon the next attempted
transaction, the merchant might be informed to ask the customer to call the bank in order to authorize the
transaction.
This method is still generally the primary fraud detection procedure in use today. The problem with this
method is that it typically takes hours or even days to flag a card that is perhaps being used fraudulently. During
this time, the bank can experience significant losses as additional fraudulent transactions are made. In general,
the bank is responsible for such transactions and purchases made by the customers based on the price ranges that
can be determined dynamically by applying a clustering algorithm on the values of each cardholder’s
transactions, as shown in Table 1
Login
Information
Security
Check Information
Verification
Done (via SMS)
Card Entry
Transaction
Processed
Complete
3. Analysis of Spending Pattern on Credit card Fraud Detection
DOI: 10.9790/0661-17216164 www.iosrjournals.org 63 | Page
B. Investigation made on Customer Transaction.
Cust_ID Frequency of Card Usage Average Amount
R0T 8K7 5 3000
W7X 2P8 3 45000
Y9T 8Q6 1 2000
Q6V 6Z2 5 1000
O1M 8P3 4 250
Y1A 4K1 2 6500
Table 1. Customer Monthly Transaction
Consider three price ranges namely, low (l), medium (m), and high (h)]. Our set of observation
symbols for example, let l= (0, 10000), m = (10000, 50000), and h= (50000 to credit card limit). If a cardholder
performs a transaction of 15000, then the corresponding observation symbol is m.
A credit cardholder makes different kinds of purchases of different amounts over a period of time. One
possibility is to consider the sequence of transaction amounts and look for deviations in them. However, the
sequence of types of purchase is more stable compared to the sequence of transaction amounts. The reason is
that, a cardholder makes purchases depending on his need for procuring different types of items over a period of
time. This, in turn, generates a sequence of transaction amounts. Each individual transaction amount usually
depends on the corresponding type of purchase. Hence, consider the transition in the type of purchase as state
transition in our model. The type of each purchase is linked to the line of business of the corresponding
merchant. This information about the merchant’s line of business is not known to the issuing bank running the
FDS. The authentication code will be send to the registered mobile number of the user, every time the user tries
to purchase. Thus, the type of purchase of the cardholder is hidden from the FDS. The set of all possible types
of purchase and, equivalently, the set of all possible lines of business of merchants forms the set of hidden states
of the HMM. A card transaction is captured by such devices as a point-of-sale (POS) terminal in a store, a
customer’s browser communicating with a website, or an ATM. The information concerning the request must be
rapidly gathered from the servicing network to which the devices are connected, sent to the issuing bank for
authorization/approval, and the response rapidly returned in order for the system to complete the transaction.
Highly Secured from unauthorized anomalous user using credit card and avoids fraud usage of card through
online transactions.
IV. Results And Discussion
The transaction-switching service provider realized that there was an opportunity to provide a unique
and important service to the issuing banks. If it could detect suspicious or fraudulent activity in real-time, it
could stop fraudulent transactions at the retail counter or at the ATM much sooner, or in some cases, even
before they were authorized. This service would be a value-added service that would distinguish it from other
ATM/POS switching networks. To implement this system, the switching provider installed multiple high-
performance servers that could quickly analyze transactions on-the-fly to determine if they were suspicious. The
selected servers were large Sun Solaris servers running Oracle databases. Each server comprised eight quad-core
CPUs. Each data centre is provided with its own fraud detection complex; comprising multiple Sun
Solaris/Oracle servers (the cards/accounts are assigned to particular Sun Solaris/Oracle servers at a site in order
to partition the work load). The fraud detection complex is easily scalable to handle additional load by adding
additional servers and reassigning the accounts/cards accordingly. Fraud detection will be checked on last 20
transactions and also calculate percentage of each spending profile (low, medium and high) based on total
number of transactions. In Table 2, list of all transactions are shown.
Cust_ID No. of Transaction Transaction Amount
R0T 8K7 5 15x103
W7X 2P8 3 135x103
Y9T 8Q6 1 2x103
Q6V 6Z2 5 5x103
O1M 8P3 4 1x103
Y1A 4K1 2 13x103
Table2. List of transactions.
The most recent transaction is placed at the first position. The pattern of spending profile of the card
holder is shown in (Figure 2) based on all transactions done. In this new approach, when a transaction is
received by a switch node, it is sent not only to the issuing bank for authorization, but it is also replicated in
real-time to a fraud detection server via a Shadow base replication engine. Shadow base engine routes the
transaction to the particular fraud detection server that is monitoring that card or account. Transaction
distribution by card number or account is accomplished via routing rules configured into the Shadow base
replication engine.
4. Analysis of Spending Pattern on Credit card Fraud Detection
DOI: 10.9790/0661-17216164 www.iosrjournals.org 64 | Page
Figure 2: Spending pattern for customer transactions.
The action taken by the switch node for a suspicious transaction can be configured to correspond to the
desires of the issuing bank and the merchant. In still other situations, the issuing bank may want to allow the
transaction but leave a voice or e-mail message or sms for the customer notifying him of a potentially suspicious
transaction. It secures the transaction using OTP via sms and Detect the anomalous transaction when cardholder
lost the card. The percentage calculation of each spending pattern (low, medium and high) of the card holder
based on price distribution range as mentioned earlier is shown in Figure 3
Figure 3: Percentage of Spending Profile 1
It has been noticed that low spending profile has maximum percentage of 50, followed by medium
profile 33% and then 17% of high spending profile as per details of transactions in Table 2.
V. Conclusion And Future Work
The proposed solution for credit card fraud detection using HMM has different steps in credit card
transaction processing are represented as the under-lying a statistical process involving a number of random
variables depending on a variable parameter of an HMM and it secure the transaction using OTP via sms. It
Detect the anomalous transaction when cardholder lost the card. The ranges of transaction amount has been
used as the observation symbols, whereas the types of item have been considered to be states of the HMM. It
has also been explained how the HMM can detect whether an incoming transaction is fraudulent or not.
Experimental results show the performance and effectiveness of the spending profile of the cardholders. The
system is also scalable for handling large volumes of transactions. In Future thumb impression or face
recognition can also be implemented while using credit card in purchases.
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