Combination of Ensemble Data Mining Methods for Detecting Credit Card Fraud Transactions

As we know, credit cards speed up and make life easier for all citizens and bank customers. They can use it anytime and anyplace according to their personal needs, instantly and quickly and without hassle, without worrying about carrying a lot of cash and more security than having liquidity. Together, these factors make credit cards one of the most popular forms of online banking. This has led to widespread and increasing use for easy payment for purchases made through mobile phones, the Internet, ATMs, and so on. Despite the popularity and ease of payment with credit cards, there are various security problems, increasing day by day. One of the most important and constant challenges in this field is credit card fraud all around the world. Due to the increasing security issues in credit cards, fraudsters are also updating themselves. In general, as a field grows in popularity, more fraudsters are attracted to it, and this is where credit card security comes into play. So naturally, this worries banks and their customers around the world. Meanwhile, financial information acts as the main factor in market financial transactions. For this reason, many researchers have tried to prioritize various solutions for detecting, predicting, and preventing credit card fraud in their research work and provide essential suggestions that have been associated with significant success. One of the practical and successful methods is data mining and machine learning. In these methods, one of the most critical parameters in fraud prediction and detection is the accuracy of fraud transaction detection. This research intends to examine the Gradient Boosting methods, which are a subset of Ensemble Learning and machine learning methods. By combining these methods, we can identify credit card fraud, reduce error rates, and improve the detection process, which in turn increases efficiency and accuracy. This study compared the two algorithms LightGBM and XGBoost, merged them using simple and weighted averaging techniques, and then evaluate the models using AUC, Recall, F1-score, Precision, and Accuracy. The proposed model provided 95.08, 90.57, 89.35, 88.28, and 99.27, respectively, after applying feature engineering and using the weighted average approach for the mentioned validation parameters. As a result, function engineering and weighted averaging significantly improved prediction and detection accuracy.