Credit Card Fraud Detection with NCA Dimensionality Reduction

Bestami Yuksel B., Bahtiyar Ş., Yilmazer A.

13th International Conference on Security of Information and Networks, SIN 2020, Virtual, Online, Turkey, 4 - 06 November 2020 identifier

  • Publication Type: Conference Paper / Full Text
  • Doi Number: 10.1145/3433174.3433178
  • City: Virtual, Online
  • Country: Turkey
  • Keywords: Credit Card Fraud, KNN, NCA
  • Istanbul Technical University Affiliated: Yes


© 2020 ACM.Credit card transactions for online payments have increased dramatically and fraud attempts on these payments have become prevalent with more advanced attacks. Thus, conventional fraud detection mechanisms are inadequate to provide acceptable accuracy for fraud detections. Machine learning algorithms may provide a proactive mechanism to prevent credit card fraud with acceptable accuracy. In paper, we propose a new approach with machine learning for credit card fraud detections by increasing the performance of classification algorithms. We use the Neighborhood Component Analysis (NCA) dimensionality reduction to improve success rate for credit card fraud detections that use K-Nearest Neighbors (KNN) classification algorithm. We implemented the proposed approach and we tested it on a dataset. Particularly, we evaluated the results with the Area under the Receiver Operating Characteristic (AUROC) metric. The analyses results show that our approach provides better accuracy for credit card fraud detections.