A blockchain-based solution to combating identity crime and credit card application fraud using data mining algorithms

Abstract

Fraud, specifically identity theft and credit card fraud, poses significant threats not only to financial institutions but also to their users. In response to this growing problem, we present an innovative approach that integrates self-sovereign identity management based on blockchain and complex data analysis. Our comprehensive solution is designed to revolutionize identity verification in credit card application processes by significantly enhancing security and reducing vulnerability to identity fraud. The system that will be developed from our solution will help users obtain self-sovereign identity credentials through blockchain technology or distributed ledger technology, granting them full control over their personal data. This approach has been proven to drastically reduce the likelihood of identity theft, and it does not require centralization of data. Besides, the use of blockchain technology ensures more credible records of identification, as they are transparent and immutable. At P&L, we combine smart data mining with blockchain-based identity solutions as our primary strategy. These algorithms detect patterns and anomalies related to identity theft in massive datasets. The technology can quickly flag suspicious activity and verify identity claims in real-time by continuously comparing recent user activity with historical data.