In recent years, machine learning algorithms have become ubiquitous in a multitude of high-stakes decision-making applications. The unparalleled ability of machine learning algorithms to learn patterns from data also enables them to incorporate biases embedded within. A biased model can then make decisions that disproportionately harm certain groups in society -- limiting their access to financial services, for example. The awareness of this problem has given rise to the field of Fair ML, which focuses on studying, measuring, and mitigating unfairness in algorithmic prediction, with respect to a set of protected groups (e.g., race or gender). However, the underlying causes for algorithmic unfairness still remain elusive, with researchers divided between blaming either the ML algorithms or the data they are trained on. In this work, we maintain that algorithmic unfairness stems from interactions between models and biases in the data, rather than from isolated contributions of either of them. To this end, we propose a taxonomy to characterize data bias and we study a set of hypotheses regarding the fairness-accuracy trade-offs that fairness-blind ML algorithms exhibit under different data bias settings. On our real-world account-opening fraud use case, we find that each setting entails specific trade-offs, affecting fairness in expected value and variance -- the latter often going unnoticed. Moreover, we show how algorithms compare differently in terms of accuracy and fairness, depending on the biases affecting the data. Finally, we note that under specific data bias conditions, simple pre-processing interventions can successfully balance group-wise error rates, while the same techniques fail in more complex settings.
Tabular data is prevalent in many high-stakes domains, such as financial services or public policy. Gradient Boosted Decision Trees (GBDT) are popular in these settings due to their scalability, performance, and low training cost. While fairness in these domains is a foremost concern, existing in-processing Fair ML methods are either incompatible with GBDT, or incur in significant performance losses while taking considerably longer to train. We present FairGBM, a dual ascent learning framework for training GBDT under fairness constraints, with little to no impact on predictive performance when compared to unconstrained GBDT. Since observational fairness metrics are non-differentiable, we propose smooth convex error rate proxies for common fairness criteria, enabling gradient-based optimization using a ``proxy-Lagrangian'' formulation. Our implementation shows an order of magnitude speedup in training time relative to related work, a pivotal aspect to foster the widespread adoption of FairGBM by real-world practitioners.
João Lucas Martins, João Bravo, Ana Sofia Gomes et al.
Financial fraud is the cause of multi-billion dollar losses annually. Traditionally, fraud detection systems rely on rules due to their transparency and interpretability, key features in domains where decisions need to be explained. However, rule systems require significant input from domain experts to create and tune, an issue that rule induction algorithms attempt to mitigate by inferring rules directly from data. We explore the application of these algorithms to fraud detection, where rule systems are constrained to have a low false positive rate (FPR) or alert rate, by proposing RIFF, a rule induction algorithm that distills a low FPR rule set directly from decision trees. Our experiments show that the induced rules are often able to maintain or improve performance of the original models for low FPR tasks, while substantially reducing their complexity and outperforming rules hand-tuned by experts.
Tiago Leon Melo, João Bravo, Marco O. P. Sampaio et al.
Adversarial attacks are a major concern in security-centered applications, where malicious actors continuously try to mislead Machine Learning (ML) models into wrongly classifying fraudulent activity as legitimate, whereas system maintainers try to stop them. Adversarially training ML models that are robust against such attacks can prevent business losses and reduce the work load of system maintainers. In such applications data is often tabular and the space available for attackers to manipulate undergoes complex feature engineering transformations, to provide useful signals for model training, to a space attackers cannot access. Thus, we propose a new form of adversarial training where attacks are propagated between the two spaces in the training loop. We then test this method empirically on a real world dataset in the domain of credit card fraud detection. We show that our method can prevent about 30% performance drops under moderate attacks and is essential under very aggressive attacks, with a trade-off loss in performance under no attacks smaller than 7%.
Daniel Basilewitsch, João F. Bravo, Christian Tutschku et al.
We compare the performance of randomized classical and quantum neural networks (NNs) as well as classical and quantum-classical hybrid convolutional neural networks (CNNs) for the task of supervised binary image classification. We keep the employed quantum circuits compatible with near-term quantum devices and use two distinct methodologies: applying randomized NNs on dimensionality-reduced data and applying CNNs to full image data. We evaluate these approaches on three fully-classical data sets of increasing complexity: an artificial hypercube data set, MNIST handwritten digits and industrial images. Our central goal is to shed more light on how quantum and classical models perform for various binary classification tasks and on what defines a good quantum model. Our study involves a correlation analysis between classification accuracy and quantum model hyperparameters, and an analysis on the role of entanglement in quantum models, as well as on the impact of initial training parameters. We find classical and quantum-classical hybrid models achieve statistically-equivalent classification accuracies across most data sets with no approach consistently outperforming the other. Interestingly, we observe that quantum NNs show lower variance with respect to initial training parameters and that the role of entanglement is nuanced. While incorporating entangling gates seems advantageous, we also observe the (optimizable) entangling power not to be correlated with model performance. We also observe an inverse proportionality between the number of entangling gates and the average gate entangling power. Our study provides an industry perspective on quantum machine learning for binary image classification tasks, highlighting both limitations and potential avenues for further research in quantum circuit design, entanglement utilization, and model transferability across varied applications.
Systems characterized by evolving interactions, prevalent in social, financial, and biological domains, are effectively modeled as continuous-time dynamic graphs (CTDGs). To manage the scale and complexity of these graph datasets, machine learning (ML) approaches have become essential. However, CTDGs pose challenges for ML because traditional static graph methods do not naturally account for event timings. Newer approaches, such as graph recurrent neural networks (GRNNs), are inherently time-aware and offer advantages over static methods for CTDGs. However, GRNNs face another issue: the short truncation of backpropagation-through-time (BPTT), whose impact has not been properly examined until now. In this work, we demonstrate that this truncation can limit the learning of dependencies beyond a single hop, resulting in reduced performance. Through experiments on a novel synthetic task and real-world datasets, we reveal a performance gap between full backpropagation-through-time (F-BPTT) and the truncated backpropagation-through-time (T-BPTT) commonly used to train GRNN models. We term this gap the "truncation gap" and argue that understanding and addressing it is essential as the importance of CTDGs grows, discussing potential future directions for research in this area.
Marco Roth, David A. Kreplin, Daniel Basilewitsch et al.
Automated Machine Learning (AutoML) has significantly advanced the efficiency of ML-focused software development by automating hyperparameter optimization and pipeline construction, reducing the need for manual intervention. Quantum Machine Learning (QML) offers the potential to surpass classical machine learning (ML) capabilities by utilizing quantum computing. However, the complexity of QML presents substantial entry barriers. We introduce \emph{AutoQML}, a novel framework that adapts the AutoML approach to QML, providing a modular and unified programming interface to facilitate the development of QML pipelines. AutoQML leverages the QML library sQUlearn to support a variety of QML algorithms. The framework is capable of constructing end-to-end pipelines for supervised learning tasks, ensuring accessibility and efficacy. We evaluate AutoQML across four industrial use cases, demonstrating its ability to generate high-performing QML pipelines that are competitive with both classical ML models and manually crafted quantum solutions.
Fraud detection is essential in financial services, with the potential of greatly reducing criminal activities and saving considerable resources for businesses and customers. We address online fraud detection, which consists of classifying incoming transactions as either legitimate or fraudulent in real-time. Modern fraud detection systems consist of a machine learning model and rules defined by human experts. Often, the rules performance degrades over time due to concept drift, especially of adversarial nature. Furthermore, they can be costly to maintain, either because they are computationally expensive or because they send transactions for manual review. We propose ARMS, an automated rules management system that evaluates the contribution of individual rules and optimizes the set of active rules using heuristic search and a user-defined loss-function. It complies with critical domain-specific requirements, such as handling different actions (e.g., accept, alert, and decline), priorities, blacklists, and large datasets (i.e., hundreds of rules and millions of transactions). We use ARMS to optimize the rule-based systems of two real-world clients. Results show that it can maintain the original systems' performance (e.g., recall, or false-positive rate) using only a fraction of the original rules (~ 50% in one case, and ~ 20% in the other).