Hybrid IF–GNN–IF Framework for Suspected Fraud Detection in Bank Switching Transactions
DOI:
https://doi.org/10.63158/journalisi.v8i5.1799Keywords:
Fraud detection, bank switching, Isolation Forest, Graph Neural Network, anomaly detectionAbstract
Fraud detection in financial transactions remains a major challenge in the banking industry, particularly in bank switching systems that process high transaction volumes and involve complex interactions among transaction entities. This study proposes a hybrid Isolation Forest–Graph Neural Network–Isolation Forest (IF–GNN–IF) framework to identify suspected fraudulent transactions in bank switching data. In the first stage, Isolation Forest detects potentially anomalous transactions and produces anomaly scores that are used to construct pseudo-labels. In the second stage, a Graph Neural Network learns relational patterns from a transaction graph by integrating original transaction attributes with the pseudo-labels. In the final stage, the learned graph embeddings are combined with the original transaction features and evaluated using a second Isolation Forest to generate final anomaly scores. The framework was evaluated using 71,873 bank switching transaction records and achieved an accuracy of 0.9668, precision of 0.9200, recall of 0.3681, and an F1-score of 0.5258. The high precision indicates that the framework effectively identifies suspicious transaction patterns. However, the relatively low recall suggests that some suspected fraud cases remain undetected. Therefore, further validation using confirmed fraud labels is necessary to assess the practical effectiveness and generalizability of the proposed framework in real-world banking environments.
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