Detection of Fraud Transactions Using Recurrent Neural Network during COVID-19

Abstract

Online transactions are becoming more popular in present situation where the globe is facing an unknown disease COVID-19. Now authorities of several countries have requested people to use cashless transaction as far as possible. Practically, it is not always possible to use it in all transactions. Since number of such cashless transactions has been increasing during lockdown period due to COVID-19, fraudulent transactions are also increasing in a rapid way. Fraud can be analysed by viewing a series of customer transactions data that was done in his/ her previous transactions. Normally banks or other transaction authorities warn their customers about the transaction, if they notice any deviation from available patterns; the authorities consider it as a possibly fraudulent transaction. For detection of fraud during COVID-19, banks and credit card companies are applying various methods such as data mining, decision tree, rule based mining, neural network, fuzzy clustering approach and machine learning methods. The approach tries to find out normal usage pattern of customers based on their former activities. The objective of this paper is to propose a method to detect such fraud transactions during such unmanageable situation of the pandemic. Digital payment schemes are often threatened by fraudulent activities. Detecting fraud transactions during money transfer may save customers from financial loss. Mobile-based money transactions are focused in this paper for fraud detection. A Deep Learning (DL) framework is suggested in the paper that monitors and detects fraudulent activities. Implementing and applying Recurrent Neural Network on PaySim generated synthetic financial dataset, deceptive transactions are identified. The proposed method is capable to detect deceptive transactions with an accuracy of 99.87%, F1-Score of 0.99 and MSE of 0.01.