Exploring Correlation Network for Cheating Detection

The correlation network, typically formed by computing pairwise correlations between variables, has recently become a competitive paradigm to discover insights in various application domains, such as climate prediction, financial marketing, and bioinformatics. In this study, we adopt this paradigm to detect cheating behavior hidden in business distribution channels, where falsified big deals are often made by collusive partners to obtain lower product prices—a behavior deemed to be extremely harmful to the sale ecosystem. To this end, we assume that abnormal deals are likely to occur between two partners if their purchase-volume sequences have a strong negative correlation. This seemingly intuitive rule, however, imposes several research challenges. First, existing correlation measures are usually symmetric and thus cannot distinguish the different roles of partners in cheating. Second, the tick-to-tick correspondence between two sequences might be violated due to the possible delay of purchase behavior, which should also be captured by correlation measures. Finally, the fact that any pair of sequences could be correlated may result in a number of false-positive cheating pairs, which need to be corrected in a systematic manner. To address these issues, we propose a correlation network analysis framework for cheating detection. In the framework, we adopt an asymmetric correlation measure to distinguish the two roles, namely, cheating seller and cheating buyer, in a cheating alliance. Dynamic Time Warping is employed to address the time offset between two sequences in computing the correlation. We further propose two graph-cut methods to convert the correlation network into a bipartite graph to rank cheating partners, which simultaneously helps to remove false-positive correlation pairs. Based on a 4-year real-world channel dataset from a worldwide IT company, we demonstrate the effectiveness of the proposed method in comparison to competitive baseline methods.