transfer wise data talk 2
TRANSCRIPT
FIGHTING FRAUD WITH GOOD CUSTOMERS IN MIND
LAUR
+
MAKING THE FINANCIAL SYSTEM FAIR AND TRANSPARENT
€700 MILLION IN TRANSFERS PER MONTH
€30 MILLION OF CUSTOMERS MONEY SAVED EVERY MONTH
TRUSTED ALL OVER THE WORLD
CAN SEND MONEY FROM
TRUSTED ALL OVER THE WORLD
CAN SEND MONEY TO
FRAUD 101
CHARGEBACK =
PRICE
WHAT TO DO ABOUT IT?
FRAUD AGENTS>>>
MANUAL REVIEW
TEAM
FRAUD ENGINE
STATIC RULES
SCO
RING
RULES
80+ YEARS OLD
+10“FUN”
FRAUD ENGINE
STATIC RULES
SCO
RING
MANUAL REVIEW
RULE BASED SYSTEM- Become outdated
- New rule for each pattern
PRICE
PRICE SPEED
PRICE SPEED
CONVENIENCE
PRICE SPEED
CONVENIENCE COVERAGE
TEAM
FRAUD ENGINE
STATIC RULES
SCO
RING
DYNAMIC RULES
FEATURE 1 FEATURE 2 FEATURE 3DYNAMIC RULE MODEL
SOURCE CURRENCY AMOUNT TIER £ NUMBER IN EMAIL?DYNAMIC RULE MODEL
FEATURE 1 FEATURE 2 FEATURE 3
SOURCE CURRENCY AMOUNT TIER £ NUMBER IN EMAIL?
USD 100-200 Yes
EUR 1000-1100 Yes
GBP 500-600 No
…
DYNAMIC RULE MODEL
DYNAMIC RULE 1
DYNAMIC RULE 2
DYNAMIC RULE N
FEATURE 1 FEATURE 2 FEATURE 3
SOURCE CURRENCY AMOUNT TIER £ NUMBER IN EMAIL?
USD 100-200 Yes
EUR 1000-1100 Yes
GBP 500-600 No
…
DYNAMIC RULE MODEL
DYNAMIC RULE 1
DYNAMIC RULE 2
DYNAMIC RULE N
FEATURE 1 FEATURE 2 FEATURE 3
30%
70%
76%
SOURCE CURRENCY AMOUNT TIER £ NUMBER IN EMAIL?
USD 100-200 Yes
EUR 1000-1100 Yes
GBP 500-600 No
…
THRESHOLD: 65%
DYNAMIC RULE 1
DYNAMIC RULE 2
DYNAMIC RULE N
FEATURE 1 FEATURE 2 FEATURE 3
30%
70%
76%
DYNAMIC RULE MODEL
SOURCE CURRENCY AMOUNT TIER £ NUMBER IN EMAIL?
USD 100-200 Yes
EUR 1000-1100 Yes
GBP 500-600 No
…
THRESHOLD: 65%
DYNAMIC RULE 1
DYNAMIC RULE 2
DYNAMIC RULE N
FEATURE 1 FEATURE 2 FEATURE 3
30%
70% ADD +10
76% ADD +10
DYNAMIC RULE MODEL
PRICE SPEED
CONVENIENCE COVERAGE
FRAUD ENGINE
STATIC RULES
SCO
RING
DYNAMIC RULES
MANUALLY DEFINED:- SCORES- THRESHOLDS
FRAUD ENGINE
STATIC RULES
SCO
RING
DYNAMIC RULES
MANUALLY DEFINED:- SCORES- THRESHOLDS
NEW RULE MODEL FOR NEW PATTERN
TEAM
MACHINE LEARNING
MACHINE LEARNING
BLACK BOX Machine learning algorithm
RU
LES
OU
TPU
T
FRAUD SCORE 0..100
PARAMETERS Θ .
..
Act
IteratePredict
Act
IteratePredictTRAINING
ENGINE AGENT
Act
IteratePredictGOOD
/
BADPARAMETERS Θ
FRAUD SCORE
TRAINING
ENGINE AGENT
STATIC RULES
MAC
HIN
E LEARNIN
G
DYNAMIC RULES
FRAUD SCORE 0..100
FRAUD SCORE 0..100
0%
25%
50%
75%
100%
FPR – % of customers stopped for manual review
0% 25% 50% 75% 100%* ILLUSTRATIVE
0%
25%
50%
75%
100%
FPR – % of customers stopped for manual review
0% 25% 50% 75% 100%* ILLUSTRATIVE
RISK MANAGEMENT
* ILLUSTRATIVE
PRICE SPEED
CONVENIENCE COVERAGE
JASON TAN“NOT A RACE BETWEEN ALGORITHMS”
BLACK BOX Machine learning algorithm
TRA
NSA
CTI
ON
DAT
A
FRAUD SCORE 0..100
PARAMETERS
SCALE DATA
FEATURE ENGINEERING• Number in email • Name in email • Device fingerprinting • Geo-location mismatch
• …
OUR CHALLENGE
80 - 20
THANKS! Q?
