ABSTRACT
This chapter focuses on equipping fraud-control teams with the very best technological tools, as distinct from the dangerous notion that technological systems can actually do the work of fraud control. As the emphasis shifts from fraud investigation to fraud control, improving detection tools will become more attractive. The vogue new technologies—fuzzy logic, neural networks, artificial intelligence, and advanced technology computing platforms—all have their place in the improvement of detection systems. To analyze the strengths and weaknesses of existing detection tools, one has to understand the many different levels at which fraud can be perpetrated. Credit card issuers recognize the transaction-level threats, so they design detection apparatus and controls to contain activity. The corresponding analysis of health care fraud is a little more complex, and what follows is oversimplified. Health care insurers–whether they are private companies, nonprofits, or government—know they are victimized by many different types of extensive and sophisticated fraud schemes.
