SUBSCRIPTION FRAUD DETECTION SYSTEM

ABSTRACT
This project is concerned with GSM subscription fraud detection system using artificial neural network technique. Fraud is a multi-billion problem around the globe with huge loss of revenue. Fraud can affect the credibility and performance of telecommunication companies. The most difficult problem that faces the industry is the fact that fraud is dynamic, which  means that whenever fraudsters feel that they will be detected, they device other ways to circumvent security measures. In such cases, the perpetrators intention is to completely avoid or at least reduce the charges for using the services. Subscription fraud is one of the major types of telecommunication fraud in which a customer obtain an account without intention to pay the bill. Thus at the level of a phone number, all transactions from the number will be fraudulent. In such cases abnormal usage occurs throughout the active period of the account; which is usually used for call selling or intensive self usage. This provides a means for illegal high profit business for fraudsters requiring minimal investment and relatively low risk of getting caught. A system to prevent subscription fraud in GSM telecommunications with high impact on long distance carriers is proposed to detect fraud. The system employs adaptive flexible techniques using advanced data analysis like Artificial Neural Networks (ANN). Fed with raw data, a neural network can quickly learn to pick up patterns of unusual variations that may suggest instances of fraud on a particular account. A total of 158 data samples were collected, trained and tested using a model that allows identifying potential fraudulent customers at the time of subscription. The result shows that 80% of the prediction accuracy has been obtained. From the result produced, artificial neural network has a potential to be used for detecting subscription fraud in telecommunication.