Explainable Artificial Intelligence and Causal Inference based ATM Fraud Detection

Gaining the trust of customers and providing them empathy are very critical in the financial domain. Frequent occurrence of fraudulent activities affects these two factors. Hence, financial organizations and banks must take utmost care to mitigate them. Among them, ATM fraudulent transaction is a common problem faced by banks. There following are the critical challenges involved in fraud datasets: the dataset is highly imbalanced, the fraud pattern is changing, etc. Owing to the rarity of fraudulent activities, Fraud detection can be formulated as either a binary classification problem or One class classification (OCC). In this study, we handled these techniques on an ATM transactions dataset collected from India. In binary classification, we investigated the effectiveness of various over-sampling techniques, such as the Synthetic Minority Oversampling Technique (SMOTE) and its variants, Generative Adversarial Networks (GAN), to achieve oversampling. Further, we employed various machine learning techniques viz., Naive Bayes (NB), Logistic Regression (LR), Support Vector Machine (SVM), Decision Tree (DT), Random Forest (RF), Gradient Boosting Tree (GBT), Multi-layer perceptron (MLP). GBT outperformed the rest of the models by achieving 0.963 AUC, and DT stands second with 0.958 AUC. DT is the winner if the complexity and interpretability aspects are considered. Among all the oversampling approaches, SMOTE and its variants were observed to perform better. In OCC, IForest attained 0.959 CR, and OCSVM secured second place with 0.947 CR. Further, we incorporated explainable artificial intelligence (XAI) and causal inference (CI) in the fraud detection framework and studied it through various analyses.Comment: 34 pages; 21 Figures; 8 Table

Prediction of the Indian summer monsoon rainfall using a state-of-the-art coupled ocean-atmosphere model

A state-of-the-art model of the coupled ocean-atmosphere system, the climate forecast system (CFS), from the National Centres for Environmental Prediction (NCEP), USA, has been ported onto the PARAM Padma parallel computing system at the Centre for Development of Advanced Computing (CDAC), Bangalore and retrospective predictions for the summer monsoon (June-September) season of 2009 have been generated, using five initial conditions for the atmosphere and one initial condition for the ocean for May 2009. Whereas a large deficit in the Indian summer monsoon rainfall (ISMR; June-September) was experienced over the Indian region (with the all-India rainfall deficit by 22% of the average), the ensemble average prediction was for above-average rainfall during the summer monsoon. The retrospective predictions of ISMR with CFS from NCEP for 1981-2008 have been analysed. The retrospective predictions from NCEP for the summer monsoon of 1994 and that from CDAC for 2009 have been compared with the simulations for each of the seasons with the stand-alone atmospheric component of the model, the global forecast system (GFS), and observations. It has been shown that the simulation with GFS for 2009 showed deficit rainfall as observed. The large error in the prediction for the monsoon of 2009 can be attributed to a positive Indian Ocean Dipole event seen in the prediction from July onwards, which was not present in the observations. This suggests that the error could be reduced with improvement of the ocean model over the equatorial Indian Ocean