Direct Debit Frauds: A Novel Detection Approach

Abstract

Single Euro Payments Area (SEPA) is an initiative of the European banking industry aiming at making all electronic payments across the Euro area as easy as domestic payments currently are. One of the payment schemes defined by the SEPA mandate is the SEPA Direct Debit (SDD) that allows a creditor (biller) to collect directly funds from a debtor’s (payer’s) account. It is apparent that the use of this standard scheme facilitates the access to new markets by enterprises and public administrations and allows for a substantial cost reduction. However, the other side of the coin is represented by the security issues concerning this type of electronic payments. A study conducted by Center of Economics and Business Research (CEBR) of Britain showed that from 2006 to 2010 the Direct Debit frauds have increased of 288%. In this paper a comprehensive analysis of real SDD data provided by the EU FP7 LeanBigData project is performed. The results of this data analysis will conduct to define emerging attack patterns that can be execute against SDD and the related effective detection criteria. All the work aims at inspire the design of a security system supporting analysts to detect Direct Debit frauds.