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Dejan Sarka

Fraud Detection with the SQL Server Suite Part 5

This is the fifth, the final part of the fraud detection whitepaper. You can find the first part, the second part, the third part, and the fourth part in my previous blog posts about this topic.

The Results

In my original fraud detection whitepaper I wrote for SolidQ, I was advised by my friends to include some concrete and simple numbers to calculate the return on investment (ROI) in a language that managers can understand. with some customers, we really managed to get very impressive numbers. However, I am not repeating this calculation here. However, this is my personal blog. Therefore, I am writing my personal opinion here.

I am kind of bored with this constant requests to show simple numbers that managers can understand. Personally, I don’t think that managers are that stupid that they would not understand anything beyond primary school mathematics. And even if some of them are that dumb, I don’t care, as they can’t become my customers. They would never be able to understand the value of such an advanced technique like data mining.

I am pretty sure that the vast majority of managers can calculate approximate ROI by themselves, and also better than I can do. They definitely know their business better than I can do, and already know how much money they are losing because of frauds and how many frauds they are already preventing or catching early. In addition, I am pretty sure that most of the managers do understand the value of learning, and appreciate building of the learning infrastructure.

Therefore, in short, I am leaving to you, to the reader, to evaluate what can you expect from implementing a fraud detection continuous learning cycle. And thank you for understanding my point!

Conclusion

Fraud detection is a very popular, albeit very complex, data mining task. I have developed my own approach to fraud detection. The most significant element of this approach is the continuous learning cycle.

Although Microsoft SQL Server is not the most popular tool for data mining, I am using it. The SQL Server suite gives us all of the tools we need, and because all of the tools come from a single suite, they work perfectly together, thus substantially lowering the time needed to bring a project from the initial meeting to a production-ready deployment.

Another advantage of my approach is the mentoring with the knowledge transfer. It is not my intention to get permanent consulting contracts; I want to progress together with my customers. Once we finish the project, or sometimes even as soon as we finish the POC project, the customer can begin using and continue improving the fraud detection system constantly with the help of the continuous learning infrastructure.

Finally, due to Microsoft’s licensing policies, the customers that already possess Microsoft SQL Server Standard Edition or higher and Microsoft Excel, do not need to purchase any additional licenses.

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Comments

 

Trevor Dwyer @sqlartist said:

Hi mate, just came across this series on fraud detection - I wrote an article/paper on insurance fraud using SQL Server, Data mining in Analysis Services - I used the descision tree algorithm and also to add a bit of depth to the piece I wrapped a third party neural network algorithm into SQL Server and compared the abilities of both. I was quite pleased at the time and I even had some professor cite it in his PHD thesis.

All the best

January 10, 2014 7:06 PM
 

Dejan Sarka said:

Trevor, nice to hear from you again. Hope you are doing well. Is this whitepaper published somewhere? A quick bingle search did not return results.

January 11, 2014 3:21 AM

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About Dejan Sarka

Dejan Sarka, MCT and SQL Server MVP, is an independent consultant, trainer, and developer focusing on database & business intelligence applications. His specialties are advanced topics like data modeling, data mining, and data quality. On these toughest topics, he works and researches together with SolidQ and The Data Quality Institute. He is the founder of the Slovenian SQL Server and .NET Users Group. Dejan Sarka is the main author or coauthor of eleven books about databases and SQL Server, with more to come. Dejan Sarka also developed and is developing many courses and seminars for SolidQ, Microsoft and Pluralsight. He is a regular speaker at many conferences worldwide for more than 15 years, including conferences like Microsoft TechEd, PASS Summit and others.
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