Parameters of automated fraud detection techniques during online transactions

Abstract

Purpose This paper aims to provide information of parameters and techniques used in the automated fraud detection system during online transaction. With the increase in the use of online transactions, the concerns regarding data security have also increased. To tackle the frauds, lot of research has been done and plethora of papers are available on the related topics. The purpose of this paper is to provide the clear pathway for researchers to move in the direction of development of automated fraud detection system to prevent the fraud during online transaction. Design/methodology/approach This literature review analyses and compares the different types of techniques for detecting fraud during online transaction. An in-depth study of the most prominent journals has been done and the core methodology of the papers has been presented. This article also shed some light on different types of parameters used in fraud detection techniques during online transaction. Findings There are vast varieties of various fraud detection techniques, and every technique has completed task in its own way. After studying approximately 41 research papers, 14 books and four reports, in total 30 parameters have been identified and a detailed study of the parameters has been presented. The parameters are also listed with their details that how these parameters are used in the security system for detecting online transaction fraud. Research limitations/implications This paper provides empirical insight about the parameters and their prominence in the development of automated fraud detection security system of online transaction. This paper encourages the researchers to development of improved fraud detection system. Practical implications This paper will pave the way for researchers to do a focused research on the fraud detection methodologies. The analysis will help in zeroing down the most prevalent topic of research in this field. The researchers will be able to understand the internal details of parameters and techniques used in the fraud detection systems. This literature also helps the research to think in a variety of ways that how these parameters will be used in the development of fraud detection system. Originality/value This paper is one of the most comprehensive reviews in its field. It tries and attempts to fill a void created because of lack of compilation of the laid fraud detection parameters.

What works in fraud prevention: a review of real-world intervention projects

“…The initial literature review for this study referred to initiatives in commercially available predictive software, specialist government anti-fraud agencies and protective corporate cultures (e.g. Gilbert and Wakefield, 2018; Khattri and Kumar Singh, 2018; Schuchter and Levi, 2016). However, in most cases, the studies included in the detailed Findings section showed how slow public and private sector organisations are to experiment with innovations to combat fraud or to share results (cf.…”

“…In that regard, predictive software which facilitates early intervention against attempted or embryonic fraud would appear to be a major area of likely future benefit (cf. Khattri and Kumar Singh, 2018). Ager Caplan’s (2014) account of a community-based group assisting potential victims to avoid predatory lending also involved “extending guardianship”.…”

“…However, there is very little information available publicly, possibly because of commercial-in-confidence provisions. Some experimental simulations have been published, which show the potential of particular commercial systems, but without clear evidence of the prevention of fraud in real-world settings (Kamps and Kleinberg, 2018; Khattri and Kumar Singh, 2018; Sakurai and Smith, 2003; Singh et al , 2013).…”

“…In addition to such approaches, there have been a number of assessments of predictive software, based largely on offence profiles and anomalous activities, aimed at proactively detecting fraud or attempted fraud and shutting it down (Khattri and Kumar Singh, 2018). These digital applications appear as the main area of innovation in fraud prevention, especially in commercial settings.…”

Plastic card circumvention an infirmity of authenticity and authorization

“…With an ATM/POS transaction uses a combination of type-I (PIN) and type-II (payment card) as multifactor authentication. E-commerce site transaction uses a combination of type-I (card credentials) and type-II (OTP) as multifactor authentication (Khattri and Singh, 2018b).…”