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Unsupervised Outlier Detection in Audit Analytics: A Case Study Using USA Spending Data

arXiv.org Artificial Intelligence

This study investigates the effectiveness of unsupervised outlier detection methods in audit analytics, utilizing USA spending data from the U.S. Department of Health and Human Services (DHHS) as a case example. We employ and compare multiple outlier detection algorithms, including Histogram-based Outlier Score (HBOS), Robust Principal Component Analysis (PCA), Minimum Covariance Determinant (MCD), and K-Nearest Neighbors (KNN) to identify anomalies in federal spending patterns. The research addresses the growing need for efficient and accurate anomaly detection in large-scale governmental datasets, where traditional auditing methods may fall short. Our methodology involves data preparation, algorithm implementation, and performance evaluation using precision, recall, and F1 scores. Results indicate that a hybrid approach, combining multiple detection strategies, enhances the robustness and accuracy of outlier identification in complex financial data. This study contributes to the field of audit analytics by providing insights into the comparative effectiveness of various outlier detection models and demonstrating the potential of unsupervised learning techniques in improving audit quality and efficiency. The findings have implications for auditors, policymakers, and researchers seeking to leverage advanced analytics in governmental financial oversight and risk management.


Randomized PCA Forest for Outlier Detection

arXiv.org Machine Learning

--We propose a novel unsupervised outlier detection method based on Randomized Principal Component Analysis (PCA). Inspired by the performance of Randomized PCA (RPCA) Forest in approximate K-Nearest Neighbor (KNN) search, we develop a novel unsupervised outlier detection method that utilizes RPCA Forest for outlier detection. Experimental results showcase the superiority of the proposed approach compared to the classical and state-of-the-art methods in performing the outlier detection task on several datasets while performing competitively on the rest. The extensive analysis of the proposed method reflects it high generalization power and its computational efficiency, highlighting it as a good choice for unsupervised outlier detection. An outlier, as defined by Hawkins [18], is "an observation which deviates so much from other observations as to arouse suspicions that it was generated by a different mechanism." Similarly, Barnett and Lewis [3] describe it as "an observation (or subset of observations) which appears to be inconsistent with the remainder of that set of data." Outlier detection is the process of identifying such outliers, i.e., the data points which differ from the rest of the data. It is one of the most important and fundamental tasks in data mining and machine learning with applications in intrusion detection [20], fault detection [37], fraud detection [7] and others [11], [13], [27]. In recent years, many methods have been proposed to carry out the outlier detection task [1], [9], [10], [23], [42]. Despite the demonstration of promising results, further studies show that these results might be limited only to specific instances of the problem (e.g., a limited selection of datasets, a specific kind of outliers, etc.) [6].


UniOD: A Universal Model for Outlier Detection across Diverse Domains

arXiv.org Artificial Intelligence

Outlier detection (OD) seeks to distinguish inliers and outliers in completely unlabeled datasets and plays a vital role in science and engineering. Most existing OD methods require troublesome dataset-specific hyperparameter tuning and costly model training before they can be deployed to identify outliers. In this work, we propose UniOD, a universal OD framework that leverages labeled datasets to train a single model capable of detecting outliers of datasets from diverse domains. Specifically, UniOD converts each dataset into multiple graphs, produces consistent node features, and frames outlier detection as a node-classification task, and is able to generalize to unseen domains. As a result, UniOD avoids effort on model selection and hyperparameter tuning, reduces computational cost, and effectively utilizes the knowledge from historical datasets, which improves the convenience and accuracy in real applications. We evaluate UniOD on 15 benchmark OD datasets against 15 state-of-the-art baselines, demonstrating its effectiveness.


Improving Out-of-Distribution Detection with Markov Logic Networks

arXiv.org Artificial Intelligence

Out-of-distribution (OOD) detection is essential for ensuring the reliability of deep learning models operating in open-world scenarios. Current OOD detectors mainly rely on statistical models to identify unusual patterns in the latent representations of a deep neural network. This work proposes to augment existing OOD detectors with probabilistic reasoning, utilizing Markov logic networks (MLNs). MLNs connect first-order logic with probabilistic reasoning to assign probabilities to inputs based on weighted logical constraints defined over human-understandable concepts, which offers improved explainability. Through extensive experiments on multiple datasets, we demonstrate that MLNs can significantly enhance the performance of a wide range of existing OOD detectors while maintaining computational efficiency. Furthermore, we introduce a simple algorithm for learning logical constraints for OOD detection from a dataset and showcase its effectiveness.


MOOSComp: Improving Lightweight Long-Context Compressor via Mitigating Over-Smoothing and Incorporating Outlier Scores

arXiv.org Artificial Intelligence

Recent advances in large language models have significantly improved their ability to process long-context input, but practical applications are challenged by increased inference time and resource consumption, particularly in resource-constrained environments. To address these challenges, we propose MOOSComp, a token-classification-based long-context compression method that enhances the performance of a BERT-based compressor by mitigating the over-smoothing problem and incorporating outlier scores. In the training phase, we add an inter-class cosine similarity loss term to penalize excessively similar token representations, thereby improving the token classification accuracy. During the compression phase, we introduce outlier scores to preserve rare but critical tokens that are prone to be discarded in task-agnostic compression. These scores are integrated with the classifier's output, making the compressor more generalizable to various tasks. Superior performance is achieved at various compression ratios on long-context understanding and reasoning benchmarks. Moreover, our method obtains a speedup of 3.3x at a 4x compression ratio on a resource-constrained mobile device.


Explainable Unsupervised Anomaly Detection with Random Forest

arXiv.org Machine Learning

We describe the use of an unsupervised Random Forest for similarity learning and improved unsupervised anomaly detection. By training a Random Forest to discriminate between real data and synthetic data sampled from a uniform distribution over the real data bounds, a distance measure is obtained that anisometrically transforms the data, expanding distances at the boundary of the data manifold. We show that using distances recovered from this transformation improves the accuracy of unsupervised anomaly detection, compared to other commonly used detectors, demonstrated over a large number of benchmark datasets. As well as improved performance, this method has advantages over other unsupervised anomaly detection methods, including minimal requirements for data preprocessing, native handling of missing data, and potential for visualizations. By relating outlier scores to partitions of the Random Forest, we develop a method for locally explainable anomaly predictions in terms of feature importance.


Learning Dexterous In-Hand Manipulation with Multifingered Hands via Visuomotor Diffusion

arXiv.org Artificial Intelligence

We present a framework for learning dexterous in-hand manipulation with multifingered hands using visuomotor diffusion policies. Our system enables complex in-hand manipulation tasks, such as unscrewing a bottle lid with one hand, by leveraging a fast and responsive teleoperation setup for the four-fingered Allegro Hand. We collect high-quality expert demonstrations using an augmented reality (AR) interface that tracks hand movements and applies inverse kinematics and motion retargeting for precise control. The AR headset provides real-time visualization, while gesture controls streamline teleoperation. To enhance policy learning, we introduce a novel demonstration outlier removal approach based on HDBSCAN clustering and the Global-Local Outlier Score from Hierarchies (GLOSH) algorithm, effectively filtering out low-quality demonstrations that could degrade performance. We evaluate our approach extensively in real-world settings and provide all experimental videos on the project website: https://dex-manip.github.io/


Toward Universal Laws of Outlier Propagation

arXiv.org Artificial Intelligence

We argue that Algorithmic Information Theory (AIT) admits a principled way to quantify outliers in terms of so-called randomness deficiency. For the probability distribution generated by a causal Bayesian network, we show that the randomness deficiency of the joint state decomposes into randomness deficiencies of each causal mechanism, subject to the Independence of Mechanisms Principle. Accordingly, anomalous joint observations can be quantitatively attributed to their root causes, i.e., the mechanisms that behaved anomalously. As an extension of Levin's law of randomness conservation, we show that weak outliers cannot cause strong ones when Independence of Mechanisms holds. We show how these information theoretic laws provide a better understanding of the behaviour of outliers defined with respect to existing scores.


Extended Histogram-based Outlier Score (EHBOS)

arXiv.org Machine Learning

Histogram-Based Outlier Score (HBOS) is a widely used outlier or anomaly detection method known for its computational efficiency and simplicity. However, its assumption of feature independence limits its ability to detect anomalies in datasets where interactions between features are critical. In this paper, we propose the Extended Histogram-Based Outlier Score (EHBOS), which enhances HBOS by incorporating two-dimensional histograms to capture dependencies between feature pairs. This extension allows EHBOS to identify contextual and dependency-driven anomalies that HBOS fails to detect. We evaluate EHBOS on 17 benchmark datasets, demonstrating its effectiveness and robustness across diverse anomaly detection scenarios. EHBOS outperforms HBOS on several datasets, particularly those where feature interactions are critical in defining the anomaly structure, achieving notable improvements in ROC AUC. These results highlight that EHBOS can be a valuable extension to HBOS, with the ability to model complex feature dependencies. EHBOS offers a powerful new tool for anomaly detection, particularly in datasets where contextual or relational anomalies play a significant role.