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Melissa Mills is a Counter Fraud Specialist working at the Commonwealth Fraud Prevention Centre (the Centre). We talked to Melissa to learn about the Centre, her role, and how they are using data to help prevent fraud.
The function of the Commonwealth Fraud Prevention Centre The Centre was established within the Attorney-General’s Department in July 2019 to strengthen the counter fraud capability of Australian government entities through the creation of leading practice guides and toolkits. It connects, collaborates, and fosters the sharing of information through working groups, communities of practice and providing opportunities to share lessons learnt and trends being experienced by others. The Centre also runs training workshops, webinars, and forums. Melissa’s role is to lead the data sharing and use capability development work. The Centre has developed a Data Capability Strategy aimed at improving collaboration and information sharing, and designing tools and processes that assist entities in using data to respond to fraud. Under this strategy they have delivered several projects including a Data Analytics Leading Practice Guide and Catalogue of Techniques. There is also their Fraud Data Capability Assessment Tool, plus workshops and webinars on data use and sharing. You can visit counterfraud.gov.au to find more information on the work they do outside of the data space.
Embedding data analytics into counter fraud processes Online government programs and services provides new opportunities for the use of data to prevent and detect fraud. Analysing this data can help entities prevent and disrupt fraud earlier, potentially reducing the need for lengthy and expensive fraud investigations. The Association of Certified Fraud Examiners found, in their 2020 global study on Occupational Fraud and Abuse, that proactive data monitoring and analysis can reduce the duration and losses from fraud by 33%. The Digital Government Strategy aims to digitise government services by 2025, moving paper-based claim processes online, moving authentication processes into myGov, and streamlining application and assessment processes. It provides opportunities to find efficiencies and use new data to prevent fraud, allowing them to put in mitigating fraud controls that are data-driven and low friction, allowing for both improved customer experiences and improved integrity of government programs. Fraudsters are a committed adversary and are constantly looking for weaknesses to exploit within government programs. They are diverse and dynamic, quickly adapting to changes. Some will target multiple government programs at once, or they’ll identify a high risk in one program and then pivot and target another program. Fraud is a hidden crime, being deliberately concealed and results in fraud being underestimated and underreported. Only two-thirds of Commonwealth entities currently report they have found fraud, but we know from international comparators that if you look for fraud with capability, you will often find it. Data can not only improve our ability to prevent and detect fraud, but also accurately estimate the level of fraud, which helps develop better evidence-based policy responses. The need to share and make better use of data and information across government, and the private sector, has become incredibly important for combating fraud.
What data insights tell us about fraudulent activity and what the Centre does with these The Centre has two important roles to play in using data to counter fraud. The first is building the data capability of counter fraud teams across government through provision of their leading practice guides and toolkits to assist them in utilising data analytics across the entire fraud operating model. These data analytic techniques can help reveal patterns, trends, and metrics in a deliberately concealed crime. These insights are used to improve processes that increase the efficiency of their system, help in decision-making, or uncover hidden indicators of fraud. Incorporating analytic processes into fraud control systems enables entities to quickly examine more information, identifying hidden patterns and connections, helping to proactively identify irregularities or indicators so that resources can be assigned to investigate high risk cases. There are practical examples of this currently in action. Government agencies, here and abroad, are using data analytics to determine the level of fraud risk with claims or applications. Those with a lower risk are streamlined and processed quicker but claims that are deemed a higher risk are assigned to a staff member to complete a thorough review. This ensures that available resources are focused on the high-risk claims increasing the chance of preventing fraudulent outliers. Another example is using data insights to inform nudge messaging. During an application process the information entered is compared to data from other trusted sources. If the information provided isn’t validated through this comparison, or if a particular risk profile is triggered, the applicant is sent a nudge message to check the information entered. It's important to use the insights gained to help inform strategic reporting across the fraud life cycle. Lessons learned from detection and investigation activities can be fed back into fraud risk assessments which helps to improve preventative controls and can inform decision-making. Secondly, the Centre has a long term project to develop the evidence base of the fraud problems experienced in Australia, which can only be achieved through data. They use insights from the Australian Institute of Criminology's Fraud against the Commonwealth annual census to understand Australian government entity’s experiences of fraud. These results help determine how fraud is impacting APS entities and what the fraud problem looks like across the Commonwealth, which helps inform this evidence base. This then helps inform strategic decision-making at the Commonwealth level, assisting policy and legislation and ensuring fraud measures are considered at the design stage. This evidence base also helps measure the impact of counter fraud activities more accurately, determine their impact, and help predict a return on the investment of these activities.
What is the Fraud Data Capability Assessment Toolkit and why was it created? Who should use it? What are the next steps? Stakeholder engagement in 2021 identified the core problems experienced in countering fraud, one of which was a lack of effective tools and processes to find and deal with the fraud they likely experience. Also noted was a lack of collaboration and information sharing across the APS on preventing fraud. This led to the Centre developing a Fraud Data Capability Assessment tool that aligns with the APS Data Capability Framework (DCF). APS entities can use the assessment tool to identify fraud data capabilities, strengths, areas of improvement, and enhance their fraud data analytic capabilities by identifying activities and training opportunities. The assessment tool includes a series of questions designed to measure and identify an entity’s current fraud data analytics proficiency against each of the 26 capabilities in the DCF. The questionnaire is divided into eight categories that aligns with the Centre’s Fraud Data Analytics Framework, addressing risk assessment and requirements, data acquisition, analysis, visualisation, and consumption. The Centre analyses the questionnaire results and provides the entity a report which: outlining their proficiency level against the DCF capabilities. Entities can use this to identify areas where they might like to build capacity, and the report provides information about resources that can assist with capability uplift, linking entities with other capability building activities happening across the Commonwealth. The assessment tool is currently in beta and is being piloted by some of our stakeholders. Initial feedback is positive, and it’s expected that it will go into production shortly after the DCF does. If any fraud teams are interested in piloting the Fraud Data Capability Assessment Tool, they can email info@counterfraud.gov.au. |