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Artificial intelligence combats cellular fraud

The theft of cellular telephones and resulting fraud is spiralling in South Africa, however, recent developments in fraud detection systems using artificial intelligence could be the solution.

Paul van der Merwe, Director, Knowledge Integration Dynamics (KID) points out that, much like credit card fraud, lawful owners of cellular phone numbers may not know they are being victimised until significant abuses appear on their monthly bill. This crime requires specialised investigative techniques and procedures. Van der Merwe says new discoveries and developments in fraud detection systems in the UK, for instance, have shown that the types of call made, the numbers a person rings, the length of calls and the time of day a person makes them are characteristic behaviours that are specific to individuals.

It is these 'biometrics', he says, which can be used to detect fraud. The fraud detection systems use pattern recognition software built into intelligent agents called sentinels - which assemble behaviour profiles of subscribers on a network. "If the software detects unusual activity on an account, it will send a text message to the mobile phone. The users will then have to punch in a PIN to identify themselves, or if they have a 'pay-as-you-go' phone, top up the credit to validate their ID. If they fail to do so, the phone will be cut off.

"This type of software differs from existing fraud-detection systems because it analyses behaviour dynamically. By not having fixed rules, it can recognise that users might make more calls than normal on New Year's Eve, for example, and let these through."

Van der Merwe says as telephone networks grow in sophistication, so do the possibilities for fraudulent activity on those networks. However, a combination of data visualisation and data mining techniques give useful results in fraud investigations. Van der Merwe adds that Netmap, distributed locally by KID, provides detailed analysis and data filtering functionality by identifying and graphically displaying patterns, trends and relationships contained in corporate data.

"Companies can easily spot and dynamically filter this information to identify trends and patterns in their business processes. Netmap supports train-of-thought analysis and assists users to follow their instincts through visual representations of the data to discover patterns," explains Van der Merwe. "The searching and cross-referencing capabilities of the software enable companies to considerably reduce the costs of fraud."

For further details contact Paul van der Merwe, Knowledge Integration Dynamics, (011) 787 8802, e-mail: paul@kid.co.za

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