How data mining can be used to detect fraud ?
The tax authorities working for various governments are often confronted with the challenge of detecting tax evasion and fraud. Imagine you work at the income tax department. All residents and businesses of the country earning income should file tax information electronically along with their tax payment.
– How could you use data mining concepts to help detect fraud?
– What kinds of fraud can you detect?
– Explicitly state your assumptions.
– Purely by data mining techniques, can you confirm that an individual has committed fraud? Provide reasons.