Lab 3: fraud detection under a fixed review capacity

54 min
Block 22 — Guided laboratories
Objective
build, evaluate and operate a card-fraud classifier on an authorization stream whose base rate is 0.3143 percent, whose fraud arrives in merchant-level bursts, whose merchants straddle every temporal boundary, and three of whose columns only exist forty-five days after the decision they would inform; fix the operating point from the review team's daily capacity rather than from any statistical optimum; put the course's imbalance material to work by measuring twenty remedies — class weights, six resampling schemes, four balanced ensembles and plain threshold selection — at that capacity-constrained point rather than at 0.5, and report which of them actually won; price resampling done before the split; repair the prior shift every remedy introduces; build the daily queue by expected value against a row-dependent break-even; and write the alerting plan around the fact that the only monitor able to see a genuine change of attack arrives forty-five days late.
Estimated duration
210 minutes
Prerequisites
chapters 026, 027, 028, 029, 034, 039, 050, 051, 052, 054, 055, 057, 059, 062, 064, 075, 076, 078, 079, 081 and 082, and labs 1 and 2 (085.0-lab01-churn-classification.md, 086.0-lab02-medical-screening.md)
Associated quizzes
087.1-quiz-capacity-constrained-operating-points.md to 087.9-quiz-fraud-monitoring-and-drift.md

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This lesson is part of the “Hands-on Labs” module

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