Robust Hybrid Machine Learning Model for Financial Fraud Detection in Credit Card Transactions

Financial fraud is a rising problem that affects both organizations and people, necessitating cutting-edge solutions to lessen its effects. The majority of machine learning models used now in the field of fraud detection include Logistic Regression (LR), Decision Tree (DT), and Random Forest (RF). While these traditional models frequently lack sensitivity, have trouble figuring out complex fraud patterns, and are rigid in their ability to adjust to new threats. To overcome them, this research work provides a significant advancement by combining Decision Trees and Logistic Regression into a hybrid model, boasting an impressive accuracy of 98.1%. The proposed methodology not only improves the system's ability to detect fraud accurately but also makes it more flexible to the changing fraud strategies. Additionally, a thorough comparison analysis highlights the approach's undeniable benefits. In a nutshell, this work provides a method for detecting financial fraud using a hybrid model that expertly strikes a compromise between sensitivity and accuracy. In addition to improving fraud detection, this innovation also strengthens the security of financial systems.