As the perpetrators of accounting fraud become ever more sophisticated in their techniques, fraud detection needs to step up its game. Thankfully, a group of researchers have devised a new machine learning ‘detective’ that is able to analyze not just fraud at a single firm, but predict likely fraud across whole supply chains and industries.
A paper describing the team’s approach was published in the journal Big Data Mining and Analytics on August 28 (https://ieeexplore.ieee.org/document/10654667).
“What is needed is an effective and accurate algorithm to automatically identify accounting fraud, and leave the days of random auditing behind,” said Mengqin Wang, also of Xi’an Jiaotong University.