Insurance fraud detection represents a pivotal advancement in modern insurance service, providing intelligent and digitalized monitoring to enhance management and prevent fraud. It is crucial for ensuring the security and efficiency of insurance systems. Although AI and machine learning algorithms have demonstrated strong performance in detecting fraudulent claims, the absence of standardized defense mechanisms renders current systems vulnerable to emerging adversarial threats. In this paper, we propose a GAN-based approach to conduct adversarial attacks on fraud detection systems. Our results indicate that an attacker, without knowledge of the training data or internal model details, can generate fraudulent cases that are classified as legitimate with a 99\% attack success rate (ASR). By subtly modifying real insurance records and claims, adversaries can significantly increase the fraud risk, potentially bypassing compromised detection systems. These findings underscore the urgent need to enhance the robustness of insurance fraud detection models against adversarial manipulation, thereby ensuring the stability and reliability of different insurance systems.

This study proposes a credit card fraud detection method based on Heterogeneous Graph Neural Network (HGNN) to address fraud in complex transaction networks. Unlike traditional machine learning methods that rely solely on numerical features of transaction records, this approach constructs heterogeneous transaction graphs. These graphs incorporate multiple node types, including users, merchants, and transactions. By leveraging graph neural networks, the model captures higher-order transaction relationships. A Graph Attention Mechanism is employed to dynamically assign weights to different transaction relationships. Additionally, a Temporal Decay Mechanism is integrated to enhance the model's sensitivity to time-related fraud patterns. To address the scarcity of fraudulent transaction samples, this study applies SMOTE oversampling and Cost-sensitive Learning. These techniques strengthen the model's ability to identify fraudulent transactions. Experimental results demonstrate that the proposed method outperforms existing GNN models, including GCN, GAT, and GraphSAGE, on the IEEE-CIS Fraud Detection dataset. The model achieves notable improvements in both accuracy and OC-ROC. Future research may explore the integration of dynamic graph neural networks and reinforcement learning. Such advancements could enhance the real-time adaptability of fraud detection systems and provide more intelligent solutions for financial risk control.

This paper proposes a financial fraud detection system based on improved Random Forest (RF) and Gradient Boosting Machine (GBM). Specifically, the system introduces a novel model architecture called GBM-SSRF (Gradient Boosting Machine with Simplified and Strengthened Random Forest), which cleverly combines the powerful optimization capabilities of the gradient boosting machine (GBM) with improved randomization. The computational efficiency and feature extraction capabilities of the Simplified and Strengthened Random Forest (SSRF) forest significantly improve the performance of financial fraud detection. Although the traditional random forest model has good classification capabilities, it has high computational complexity when faced with large-scale data and has certain limitations in feature selection. As a commonly used ensemble learning method, the GBM model has significant advantages in optimizing performance and handling nonlinear problems. However, GBM takes a long time to train and is prone to overfitting problems when data samples are unbalanced. In response to these limitations, this paper optimizes the random forest based on the structure, reducing the computational complexity and improving the feature selection ability through the structural simplification and enhancement of the random forest. In addition, the optimized random forest is embedded into the GBM framework, and the model can maintain efficiency and stability with the help of GBM's gradient optimization capability. Experiments show that the GBM-SSRF model not only has good performance, but also has good robustness and generalization capabilities, providing an efficient and reliable solution for financial fraud detection.

The main works [10, 11] attack the same realistic fraud detection Adversarial attacks pose a significant threat to data-driven engine called BankSealer [9]. In both works, the authors systems, and researchers have spent considerable resources rightfully consider domain-specific challenges generally absent studying them. Despite its economic relevance, this trend in other adversarial works, such as the intricate feature largely overlooked the issue of credit card fraud detection. To engineering process performed in fraud detection. However, address this gap, we propose a new threat model that demonstrates they operate under the assumption that fraudsters can access the limitations of existing attacks and highlights the the customers' transaction history. As the authors point out, necessity to investigate new approaches. We then design a this may be achieved through the introduction of malware into new adversarial attack for credit card fraud detection, employing the victim's devices. However, this considerably increases the reinforcement learning to bypass classifiers. This attack, difficulty of performing any attack, as fraudsters must first called FRAUD-RLA, is designed to maximize the attacker's compromise the customer's device and observe past transaction reward by optimizing the exploration-exploitation tradeoff history, which constitutes a significantly more complex and working with significantly less required knowledge than undertaking than stealing or cloning a card.

As online fraud becomes more sophisticated and pervasive, traditional fraud detection methods are struggling to keep pace with the evolving tactics employed by fraudsters. This paper explores the transformative role of machine learning in addressing these challenges by offering more advanced, scalable, and adaptable solutions for fraud detection and prevention. By analyzing key models such as Random Forest, Neural Networks, and Gradient Boosting, this paper highlights the strengths of machine learning in processing vast datasets, identifying intricate fraud patterns, and providing real-time predictions that enable a proactive approach to fraud prevention. Unlike rule-based systems that react after fraud has occurred, machine learning models continuously learn from new data, adapting to emerging fraud schemes and reducing false positives, which ultimately minimizes financial losses. This research emphasizes the potential of machine learning to revolutionize fraud detection frameworks by making them more dynamic, efficient, and capable of handling the growing complexity of fraud across various industries. Future developments in machine learning, including deep learning and hybrid models, are expected to further enhance the predictive accuracy and applicability of these systems, ensuring that organizations remain resilient in the face of new and emerging fraud tactics.

Anomaly detection is a critical challenge across various research domains, aiming to identify instances that deviate from normal data distributions. This paper explores the application of Generative Adversarial Networks (GANs) in fraud detection, comparing their advantages with traditional methods. GANs, a type of Artificial Neural Network (ANN), have shown promise in modeling complex data distributions, making them effective tools for anomaly detection. The paper systematically describes the principles of GANs and their derivative models, emphasizing their application in fraud detection across different datasets. And by building a collection of adversarial verification graphs, we will effectively prevent fraud caused by bots or automated systems and ensure that the users in the transaction are real. The objective of the experiment is to design and implement a fake face verification code and fraud detection system based on Generative Adversarial network (GANs) algorithm to enhance the security of the transaction process.The study demonstrates the potential of GANs in enhancing transaction security through deep learning techniques.

Fraudulent transactions and how to detect them remain a significant problem for financial institutions around the world. The need for advanced fraud detection systems to safeguard assets and maintain customer trust is paramount for financial institutions, but some factors make the development of effective and efficient fraud detection systems a challenge. One of such factors is the fact that fraudulent transactions are rare and that many transaction datasets are imbalanced; that is, there are fewer significant samples of fraudulent transactions than legitimate ones. This data imbalance can affect the performance or reliability of the fraud detection model. Moreover, due to the data privacy laws that all financial institutions are subject to follow, sharing customer data to facilitate a higher-performing centralized model is impossible. Furthermore, the fraud detection technique should be transparent so that it does not affect the user experience. Hence, this research introduces a novel approach using Federated Learning (FL) and Explainable AI (XAI) to address these challenges. FL enables financial institutions to collaboratively train a model to detect fraudulent transactions without directly sharing customer data, thereby preserving data privacy and confidentiality. Meanwhile, the integration of XAI ensures that the predictions made by the model can be understood and interpreted by human experts, adding a layer of transparency and trust to the system. Experimental results, based on realistic transaction datasets, reveal that the FL-based fraud detection system consistently demonstrates high performance metrics. This study grounds FL's potential as an effective and privacy-preserving tool in the fight against fraud.

Data economy relies on data-driven systems and complex machine learning applications are fueled by them. Unfortunately, however, machine learning models are exposed to fraudulent activities and adversarial attacks, which threaten their security and trustworthiness. In the last decade or so, the research interest on adversarial machine learning has grown significantly, revealing how learning applications could be severely impacted by effective attacks. Although early results of adversarial machine learning indicate the huge potential of the approach to specific domains such as image processing, still there is a gap in both the research literature and practice regarding how to generalize adversarial techniques in other domains and applications. Fraud detection is a critical defense mechanism for data economy, as it is for other applications as well, which poses several challenges for machine learning. In this work, we describe how attacks against fraud detection systems differ from other applications of adversarial machine learning, and propose a number of interesting directions to bridge this gap.

As the number of credit card users has increased, detecting fraud in this domain has become a vital issue. Previous literature has applied various supervised and unsupervised machine learning methods to find an effective fraud detection system. However, some of these methods require an enormous amount of time to achieve reasonable accuracy. In this paper, an Asexual Reproduction Optimization (ARO) approach was employed, which is a supervised method to detect credit card fraud. ARO refers to a kind of production in which one parent produces some offspring. By applying this method and sampling just from the majority class, the effectiveness of the classification is increased. A comparison to Artificial Immune Systems (AIS), which is one of the best methods implemented on current datasets, has shown that the proposed method is able to remarkably reduce the required training time and at the same time increase the recall that is important in fraud detection problems. The obtained results show that ARO achieves the best cost in a short time, and consequently, it can be considered a real-time fraud detection system.

Unlocking the full potential of artificial intelligence (AI) in financial services is often hindered by the inability to ensure data privacy during machine learning (ML). For instance, traditional ML methods assume all data can be moved to a central repository. This is an unrealistic assumption when dealing with data sovereignty and security considerations or sensitive data like personally identifiable information. More practically, it ignores data egress challenges and the considerable cost of creating large pooled datasets. Massive internal datasets that would be valuable for training ML models remain unused.