Tuesday, July 28, 2009

fraud detection

Fraud detection is a fraud.

No, really.

No, really. Serious.

You think I'm joking.

Okay, maybe kind of. Maybe it's not actually a fraud, but it's definitely not fraud detection.

I feel I'm not explaining the subject very well, so let's start from the beginning.

Credit card companies typically employ boring Statisticians1, like myself, to wear thick plastic glasses, tell bad jokes at parties2, and analyze millions of transactions and look for fraudulent ones. They are sort of like superheroes, or knights in shining armor, or furry cats, or whatever your vision of the apogee of greatness is3. For the record, the coolness of a Statistician is inversely proportional to the length of the name of his or her data analysis software of choice. SPSS: Super not cool, SAS: Pretty darn cool, R: TOO HOT TO HANDLE4.

Anyways, these Statisticians, when they're not telling jokes dissing on Economists, build these models and get automated robots to call you when something suspicious is happening. If you travel to a different state or country and start making purchases, they may freeze your account and try to contact you, which is why you should always check in with mommy before you go somewhere crazy, so she doesn't worry about you out with those strange friends5.

This is all well and good. A great system, and credit card companies are wise to employ it, and well, I can't speak higher of Statisticians. Normally.

Sadly, it doesn't really work. Take, for example, my trip to Utah a few months back. The powers that be noticed some odd transactions, and called me up. An automated voice took me through a few transactions that had been flagged: $15.24 for gas in Utah, $2.40 for something at Target, and $9.55 for some extra charges at a car rental company. I was super happy to get the call, and I told them all was well. This is the kind of caring company with which I like doing business6.

Except, I took a look at my account a week later and spotted the following transaction, just a day before my trip to Utah:

05/14/2009CBAUSSIEBUM LEICHHARDT$242.62

For those who can't read creditese, that would be two hundred forty two dollars and sixty two cents spent at aussieBum, an Australian men's underwear store.

So, Mr. Credit Card Company, let me get this straight. You'll call me on the ten bucks I spent on gas in my home state to which I travel frequently, and yet neglect to mention the TWO HUNDRED DOLLARS at an Australian underwear retailer? WHO BUYS TWO HUNDRED DOLLARS OF UNDERWEAR7?

Funnily, they later failed to catch the three transactions at Target in Manteca, CA which summed to $400. I've never been to Manteca, never plan on going to Manteca, and never plan on visiting the same store three times in a row on one day.

WHO DO YOU HAVE BUILDING YOUR FRAUD MODELS PEOPLE? ARE YOU DENSE? MY DEAD GOLDFISH COULD DO A BETTER JOB.

Obviously, my credit card company employs statisticians who analyze data with SPSS. Which company, by the way, was purchased by IBM today. Short IBM people. Short it. That's all I have to say.

1. I'm obviously joking here. Seriously. A boring Statistician? Ha ha! I laugh at the concept! That's an oxymoron if I ever heard one. Could a subject be boring if it contained such a concepts as the Cramér–Rao lower bound, and UMVUE (uniform minimum variance unbiased estimator). Ha! I submit it can NOT!
2. My favorite one is the definition of an actuary: someone who didn't have the personality to be an accountant.
3. Granted, your vision of greatness might include someone capable of writing that sentence without ending in a verb. Ending in 'is' can't possibly be grammatically correct, can it?
4. Take a guess as to my favorite. Also, though I referenced heat, I really meant it as a compliment, as in, both excessive amounts of heat and cold are indicators of a maximized social status function.
5. And, if you're planning on going to the midnight showing of the digitally remastered Star Wars while on a sleepover, you might think about telling your friend to NOT IMMEDIATELY VOLUNTEER THAT INFORMATION on the phone when your mom calls so she doesn't find out that you've left the house specifically to get out of her definition of curfew. Just a suggestion.
6. It's an awkward sentence, sure, but do you think I was going to end with a preposition? HERESY.
7. On second thought, don't answer that.

4 comments:

Jess said...

<$200 in underwear! Haha, classic!

Jerkolas said...

Hey hey I know how to use R!

I also once had a $150 charge from a Che Guevara t-shirt store in Toronto. Good thing I have never been to Toronto since the Che shirts totally implicate me and revolutionary ways.

Adam Wilson said...

I submit that you don't like economists because some of us use the five letter software package STATA, which must not be nearly as cool as I once thought it was.

MommaMcCarthy said...

I'm really diggin' the linked footnotes. 5 thumbs up!