CISC 849 : Applications in Fintech

Stock Market Fraud

Leonardo De La RosaInstitute for Financial Services Analytics

University of Delaware

CISC 849 : Applications in Fintech

Leonardo De La RosaInstitute for Financial Services Analytics

University of Delaware

Visualization of ATM Usage Patterns To Detect Counterfeit Cards Usage

Ben Reardon, Kara Nance and Stephen McCombie

CISC 849 : Applications in Fintech

Agenda

1 • Motivation

2 • Problem Description

3 • Fraud Life Cycle

4 • Digital Footprint

5 • Data

6 • Parallel Axis

7 • Contribution

8 • Future Considerations

9 • Startup

CISC 849 : Applications in Fintech

Motivation

• Why should we care?

Sophisticated Cybercriminals.1Unexpected attacks.2No short-term plan to switch to chip and pin.3Need for a crime-prevention approach.4

CISC 849 : Applications in Fintech

Motivation

• Why should we care?

Source: EMV: Lessons Learned and the U.S. Outlook. Aite Group, Inc

CISC 849 : Applications in Fintech

Motivation

• Why should we care?

Source: EMV: Lessons Learned and the U.S. Outlook. Aite Group, Inc

CISC 849 : Applications in Fintech

Problem• Card Present (CP) Fraud

Hypothesis of

Modus Operandi

VisualizationTechniques

Fraud Detection

CISC 849 : Applications in Fintech

Fraud Life Cycle

Counterfeiting Phase

Distribution Phase

Reconaissance Phase

Cashing Out Phase

• Four discrete phases:

Objective: detect potential misuse prior to the cashing-out phase

CISC 849 : Applications in Fintech

Digital Footprint

ATM Logs

CISC 849 : Applications in Fintech

Data

Not associated with any bank.1Illustrates common patterns of ATM usage.2

• ATM Logs

CISC 849 : Applications in Fintech

Unusual Activity: One ATM

Reconnaissance Phase

Balance check then withdrawal

Balance check onlyUnusual ActivityCounterfeit Cards?

Daily cash Limit

Grey= funds remainingBlack=account emptied

1000

500

5050 Withdrawal only

Normal activity profile

Normal activity profile

CISC 849 : Applications in Fintech

ATM Fleet Activity

CISC 849 : Applications in Fintech

ATM Fleet Activity

CISC 849 : Applications in Fintech

ATM Fleet Activity

CISC 849 : Applications in Fintech

ATM Fleet Activity

CISC 849 : Applications in Fintech

ATM Fleet Activity

CISC 849 : Applications in Fintech

Contribution

Patterns are easily identified.1Visualization enables the creation of rule sets2ATM datasets are already collected.3Account details are not necessary. 4

CISC 849 : Applications in Fintech

Future Considerations

Other Modus Operandi (more sophisticated cybercrime).

1

Card-Not-Present (CNP) form of fraud.

2Development of dashboard style displays.3

CISC 849 : Applications in Fintech

Start Up

Cloud Based System• Monitors firms’ systems in real time.

Credit Card Testing• Identification of fraudsters.

Visualization of Patterns • Streamline fraud review with data

visualization

Machine Learning• Leverages different signals to detect

fraudulent behavior

CISC 849 : Applications in Fintech

Thank You