Minimizing the Overlapping Degree to Improve Class-Imbalanced Learning Under Sparse Feature Selection: Application to Fraud Detection

In recent years, the classification of class-imbalanced data has obtained increasing attention across different scientific areas such as fraud detection, metabolomics, Cancer diagnosis, etc. This interest comes after proving the negative effect of overlapping on the performance of class-imbalanced learning. Based on augmented R-value, our proposed strategy aims to select features that make data achieve the minimal overlap degree, so improving the performance of classification as well. In this context, we present three feature selection algorithms RONS (Reduce Overlapping with No-sampling), ROS (Reduce Overlapping with SMOTE), and ROA (Reduce Overlapping with ADASYN), which are built through sparse feature selection to minimize the overlapping and perform binary classification. Also, a re-sampling process has been included in both ROS and ROA. Simulation results show that our proposed algorithms as feature selection methods manage the variation of false discovery rate during the selection of main features for the process modeling. For the experiment, four credit card datasets have been selected to test the performance of our algorithms. Using F-measure and Gmean evaluation metrics, the results reveal that our proposed algorithms are considerably recommended compared with classical feature selection methods. Besides, this effective feature selection strategy can be extended as an alternative to deal with class-imbalanced learning problems that involve overlapping.