Australian companies in the insurance and retail sector are using fraud detection software as a tool to push revenues and stem profit leakage.
Software used to track electronic fraud is providing big savings in these industries, a trend well-established in the United States.
NetMap Analytics president and CEO Richard McLean said this technology can "immediately increase earnings per share" by reducing shrinkage in the retail sector and identifying fraudulent insurance claims.
According to the Insurance Council of Australia fraudulent claims have reached $900 million a year adding about $70 to every insurance premium.
NetMap's own solution, which was developed in Australia, is already in use in the US including the government's money laundering detection centre in Washington.
It is used in Sydney by the Australian Taxation Office to identify asset ownership and the complicated flow of money by individuals and companies.
The data mining and analysis solution links data from several sources, identifies patterns and turns it into a graphical map using visualisation tools.
One of the company's largest retail customers in Australia, David Jones, is using the technology to identify electronic fraud but also to add-value to client purchases.
"Stores of this size have security in place for theft prevention and missing stock so fraudsters have had to move into the electronic space to exploit opportunities; the retail sector processes thousands of transactions daily so fraud can be hidden in such huge amounts of data," McLean said.
"Use of the technology in the US has revealed just how organised and systematic fraud rings are and I suspect the situation is no different in Australia; we will be using intellectual property gained in the US and applying it to the market here to find out."
McLean said it is difficult for police to invest money in new technology at the same rate as criminals especially when organised fraud is carried out in each state to avoid detection.
"The software has great scope for a national enforcement body such as the National Crime Authority (NCA); it is already used by the NSW and Queensland police departments," he said.
In fact NetMap technology was used to help track down serial backpacker murderer Ivan Milat several years ago.
"The police had a database with millions of individuals and by linking information on gym membership, gun club details and vehicle type we reduced the list of names to 35 and Ivan Milat was one of them," he said.
Other NetMap customers include the Australian Securities and Investment Commission (ASIC), Qantas, Telstra, BHP and Vodafone