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Payment Fraud Risk Engine

AML portfolio project lab focused on payment fraud analysis, fraud rules, risk scoring, and decisioning using SQL, PostgreSQL, DBeaver, Pandas and Python.

Objective

This project simulates a payment fraud environment and demonstrates how to:

  • analyze fraud signals with SQL
  • build fraud rules and risk logic
  • create a risk scoring model
  • assign decisions such as approve, review, 3DS required, and block
  • evaluate fraud performance with business metrics

Tech

  • PostgreSQL
  • DBeaver
  • Python
  • Pandas
  • SQL

Project Structure

  • screenshots/ → query outputs, samples and SQL analysis
  • data/raw/transactions.csv → synthetic transaction dataset
  • sql/ → SQL scripts for analysis, rules, scoring, and decisioning
  • CASE_STUDIES.md → examples of risk decisions
  • README.md → project info.

Dataset Features

  • geo mismatch *
  • IP vs billing mismatch
  • high transaction velocity *
  • chargeback history
  • VPN usage
  • account age
  • email age
  • transaction amount

Risk Scoring

  • geo mismatch = +20

  • IP vs billing mismatch = +15

  • new account = +15

  • high amount = +10

  • high velocity = +20

  • VPN usage = +10

  • chargeback history = +20

  • fresh email = +10

  • 0–29 → approve

  • 30–49 → review

  • 50–69 → 3DS required

  • 70+ → block

Key Findings

  • Geo mismatch and high velocity were the strongest fraud indicators.
  • Combining multiple signals significantly increased fraud probability.
  • High and very high risk bands showed strong fraud concentration.
  • The scoring model clearly separated low-risk from high-risk transactions.

Business Interpretation

This project shows how a fraud analyst can move from raw signals to scoring and decisioning, while balancing fraud prevention and customer friction.

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SQL , Python, Pandas, DBeaver and PostgreSQL project for payment fraud risk analysis and transaction monitoring.

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