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Big Data: Fraud, Finances

Published

12 years ago

March 27, 2014

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Financial institutions have been working hard to implement technologies which better protect them and their customers.

Innovations such as chip and PIN have made cards more secure, while the introduction of two-factor authentication has also greatly helped.

However, none of these systems are perfect and fraud levels continue to rise in many countries.

Fortunately this is an area where big data can make a significant difference.

Fraud detection relies upon the use of both relational data and non-relational data – structured and unstructured data.

Banks know where our home branch is and they know within a standard range of incidences how often we take out money or use our cards.

They know where we work and the types of transactions we make most commonly. These known quantities form part of the fraud detection process.

The unpredictability of humans….

But the nature of human beings is that we do not always stick to the path most travelled. Consider a man buying an engagement ring. This is a perfect example of something which many people may only ever do once in their lives.

Looked at in terms of that data point it appears to be an entirely random act.

A man on the hunt for an engagement ring may never even have set foot in a jewellers shop in his life.

He will almost certainly have never spent a month’s wages on a single item of jewellery. In the world of data analysis such screaming anomalies should be cause for concern.

So why are more people not challenged when making this kind of transaction? Because it is incumbent upon banks not to leave us frustrated or without cash in our hour of need.

The man buying an engagement ring may have enough on his mind without having his card declined at the point of sale. For every transaction, a bank or a card issuer is dynamically analysing data and weighing up the risk of fraud.

The key lies of course in big data.

There are many types of data, unrelated even to the individual which can quickly be referenced – in split seconds thanks to the power with which big data is processed – from data relevant to that individual, such as past travel habits, to data relevant to the nature of the suspect transaction.

Patterns of where fraud has been conducted and past behaviours of the rightful card owner are a key element in detecting and predicting fraud, to the extent that diverse frauds can be traced quickly back to specific businesses where a rogue employee may be stealing card numbers or cloning cards.

Banks now have that reservoir of data related to fraudulent activity and quickly assess the likelihood of transactions being suspect.

Back to our hopeful man shopping for an engagement ring, he may go unchallenged because that reservoir of data shows that very few fraudsters try to conduct card fraud in jewellery shops. This may be because of high levels of CCTV coverage in such shops.

…is actually quite predictable

Believe it or not, the apparently unusual purchase of engagement rings is actually fairly predictable. Somebody may never have bought an engagement ring before, but his card issuer may see from his profile that he fits the bill of somebody due to.

A recent mortgage, an increased focus on saving, a second name appearing on a credit card, an expensive holiday in contrast to the budget breaks or golf holidays he has been on with his friends in the past, regular outlay on home furniture which suggests he is setting up home with somebody, a move from a sporadic expenditure on food to a more structured approach which suggests more nights in at home, less time spent in bars, more time in restaurants.

These are all behaviours which become powerful data points in the overall modelling of customer profiles.

He may think his purchase of an engagement ring is extraordinary and a huge step but his bank – or at least the data it holds – may have been able to tell it was coming for some time.

Ultimately, data has the ability to look at us dispassionately and non-judgmentally. We may think it outrageous that we celebrate a birthday once a year by spending over the odds on dinner at a fancy restaurant we’d never normally visit on any other day of the year.

But if this is something we only do once a year then the data barely needs to be sweated to find an answer as to whether this is fraudulent behaviour.

Once per year may seem occasional to us, or even out of character, because it is at odds to the way we behave on the other 364 days of the year, but the data sees a creature of habit.

It knows it’s our birthday – not least because our date of birth is among the relational data held about us. That fact can easily be linked to any spike in spending on that date.

Even our one-off purchases are almost certainly not as one-off as we think. Most people exercise a degree of financial caution and display behaviours our banks will be able to understand from the data they collect and analyse.

We may only buy one engagement ring in our lives but the money spent on that engagement ring will almost certainly be within a predictable parameter based on our salary, our regular outgoings and the value of our mean and median purchases and the statistical outliers we will have created with purchases such as a car or a house.

All of this means that the vast majority of our spending is reassuringly predictable.

The insights into our behaviour that big data analysis brings about provides a clear benchmark against which fraudulent activity can be rapidly identified and shut down.

Adebayo Sanni is country director at Oracle

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General News

NUPRC Warns of Counterfeit, AI-Generated Appointment Letters

Published

31 minutes ago

August 12, 2026

Ebere Melum-Nwogbo

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Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has cautioned the public against fake recruitment offers and fraudulent employment letters circulating in the agency’s name.

NUPRC Warns of Counterfeit, AI-Generated Appointment Letters

Eniola Akinkuotu, head of Media and Corporate Communications of the Commission, stated that NUPRC has received reports of counterfeit and AI-generated appointment letters bearing names not known to the regulator.

The Commission also said fraudsters have been extorting money from jobseekers by promising placement within the agency.

NUPRC has reported the incidents to law enforcement and said investigations are underway.

The regulator reiterated that there is no ongoing recruitment exercise and warned members of the public not to make any payments for supposed job offers.

“Whenever the Commission decides to recruit, the process will be conducted strictly in accordance with extant laws and government regulations,” the statement said.

The Commission urged jobseekers to verify any purported offer and to rely only on official NUPRC communications for recruitment information.

The warning follows growing concerns about the misuse of digital tools, including artificial intelligence, to fabricate apparently authentic documents that can deceive the public.

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E-Financial

KudiWave Asks for Clarification over N750m Transfer from PalmPay Account

Published

31 minutes ago

August 12, 2026

Ebere Melum-Nwogbo

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KudiWave Technologies Limited has raised questions over the transfer of N750,369,439.04 from its account with PalmPay Limited, seeking clarification on the timing, destination and circumstances surrounding the transaction.

In a statement, on Tuesday, KudiWave said the disputed debit was recorded on July 15, 2026, under the narration “Judicial Adjustment”.

The company said it was not notified of, or did not authorise, the transaction.

According to KudiWave, it had already approached the Federal High Court in Lagos to challenge an earlier order affecting its account.Politics News Service

The company said its application, filed on July 3, sought to set aside the June 29 order and stay its execution.

“The motion was heard on July 13 and adjourned for ruling. Two days later, the N750.37 million was transferred out of the account,” the company said.

KudiWave further stated that PalmPay had been served with the application before the July 15 transaction and did not file a counter-affidavit opposing the application.

The company also raised questions about an earlier movement of funds on July 11, which it said became apparent after access to the account was restored.

According to KudiWave, its account records showed that the funds were moved on July 11 and returned the same day before another transfer was recorded on July 15.

“PalmPay moved the money on July 11 and sent it back that same day. They then took it out again on July 15. When the account was opened, we saw how the money had been moved around while the account was frozen and we were not aware of it,” the company said.

The dispute followed an ex parte order obtained by the Inspector General of Police through officers of the Police Special Fraud Unit in Ikoyi, which placed restrictions on accounts belonging to several parties, including KudiWave, pending investigation.

The restriction was subsequently implemented on KudiWave’s account with PalmPay.

Further proceedings were filed under Suit No. FHC/L/CS/795/2026 before Justice Ibrahim Ahmad Kala of the Federal High Court, Lagos Judicial Division, in relation to funds standing to KudiWave’s credit.

KudiWave said the court granted an application on June 29.

The company subsequently challenged the order, arguing that it had not been properly served with the processes leading to the decision and had not been effectively brought before the court when the application was heard.

According to KudiWave, Justice Kala considered the company’s subsequent application on July 22 and set aside, vacated and discharged the June 29 order.

The company said the court also directed that the restrictions placed on its account be removed.

KudiWave further stated that the court examined the circumstances surrounding the purported service of the processes and raised questions about whether leaving documents at a gate, without sufficient indication of the company’s specific address, amounted to effective service.

The company quoted the court as describing the circumstances surrounding the service as “very curious”.

KudiWave also said the ruling recognised the court’s inherent power to set aside its own decision where circumstances justify such intervention.

The July 22 ruling came after the July 15 transfer.

KudiWave, however, said the transaction should be considered in the context of the fact that the June 29 order was already being challenged and that its application had been argued before the court two days earlier.

The company has also questioned the destination of the funds.

According to KudiWave, its understanding of the June 29 order was that the identified funds were to be transferred to a designated Police Recovery Account associated with the Police Special Fraud Unit.

The company said its account records instead indicated that the N750,369,439.04 was transferred to an Access Bank business account.

KudiWave said it wants clarification on the identity of the beneficiary, the instruction that authorised the transfer and the basis for the July 11 movement of funds.

“The issue for us is simple. If the order identified a particular account for the funds, there must be a clear explanation of why our records show the money going elsewhere and who ultimately received it,” the company said.

KudiWave said it was seeking a reconciliation of transactions carried out on its account during the restriction period and was considering further legal and regulatory steps in relation to the disputed transactions.

The company also said that, during earlier efforts to resolve the restriction, Barrister Prince Oko, its Company Secretary, met with officers of the Police Special Fraud Unit.

KudiWave alleged that a request for N50 million was made in connection with efforts to remove the restriction and said the company rejected the request.

The allegation has not been independently established and has not been determined by a court.

KudiWave maintained that its concerns do not relate to compliance with lawful court orders but to whether the transactions involving its funds were carried out in accordance with the terms of the relevant judicial directive.

The company said it wants clarification on the July 11 transactions, the subsequent N750,369,439.04 transfer on July 15, the destination of the funds and the circumstances surrounding the transactions.

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Telecom

NCC Reports over 5,000 Fibre Cuts in 6 Months

Published

31 minutes ago

August 12, 2026

Ebere Melum-Nwogbo

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Nigerian Communications Commission (NCC) has said that more than 5,000 fibre-optic cable cuts linked to road construction, excavation and related civil works were recorded in the first six months of 2026.

NCC Reports over 5,000 Fibre Cuts in 6 Months

The commission said that the damage is disrupting telecommunications services, increasing operators’ costs and exposing businesses and essential public services to avoidable interruptions.

Aminu Maida, executive vice chairman, NCC, disclosed the figure at a stakeholders’ workshop on the protection of fibre-optic infrastructure during road construction and rehabilitation.

He said the scale of the incidents showed the need to prevent damage rather than wait to repair networks after they had been cut

Maida said fibre networks support banking, healthcare, education, government services, commerce, security and emergency communications.

He recalled the widespread telecommunications disruption in February 2024, when fibre cuts affected millions of Nigerians and caused congestion on alternative networks as subscribers switched providers.

He said a Standing Committee on the Protection of Fibre Optic Cables had been established by the Federal Ministries of Works and Communications, Innovation and Digital Economy to improve coordination before, during and after road construction.

The committee was later expanded to include the Office of the National Security Adviser and the Nigeria Security and Civil Defence Corps because of the critical nature of telecommunications infrastructure.

Raphael Adelador, permanent secretary of the Federal Ministry of Works, said road construction and telecommunications infrastructure often occupy the same physical space, making coordination essential.

Adelador called for better mapping of fibre routes and improved information sharing so contractors and consultants know where telecommunications infrastructure is located before excavation begins.

He said damage to fibre networks could lead to service disruptions, lost productivity, financial losses and inconvenience to citizens.

Representing Nadungu Gagare, permanent secretary, Federal Ministry of Communications, Innovation and Digital Economy, Stanley Musa, director of Telecoms and Postal Services, said the protection of telecommunications infrastructure was a shared national responsibility.

The Permanent Secretary said that the government was working with relevant stakeholders to strengthen compliance with technical standards and right-of-way requirements, improve information sharing and develop clearer procedures for infrastructure protection.

Air Vice Marshal Effiom Ewa, director of Critical National Standards and Infrastructure Protection at the Office of the National Security Adviser, said fibre-optic infrastructure had been designated as critical national information infrastructure and warned that damage caused by negligence, interference or actions that expose the infrastructure to damage could attract legal consequences.

Air Vice Marshal Ewa called for strict compliance with established procedures during construction and maintenance activities.

The two-day workshop brought together representatives of government ministries and agencies, security organisations, telecommunications operators, contractors and other stakeholders to develop practical measures for reducing fibre damage during construction projects.

The stakeholders are expected to strengthen coordination, information sharing and accountability so that road development does not undermine the digital infrastructure supporting Nigeria’s economy.

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