IT in Society

📊 CRISP-DM — 6 Stages

1. Business Understanding — Define problem, success metrics, legal constraints with the client
2. Data Understanding — Collect historical data; explore variables, quality issues, patterns
3. Data Preparation — Clean (remove duplicates, handle missing values); normalise; engineer features (e.g. transaction velocity, distance from home); create balanced training/test sets (SMOTE if class imbalance)
4. Modelling — Train ML algorithms (decision trees, random forests, neural networks); tune hyperparameters
5. Evaluation — Test on unseen data: accuracy, precision, recall, F1-score, ROC-AUC; assess false positive rate
6. Deployment — Integrate into live system; monitor; schedule regular retraining as fraud patterns evolve

⚠️ Bank fraud tip: Fraud events are RARE (class imbalance) — mention oversampling (SMOTE) in Data Preparation for high-mark answers. False positives (blocking legitimate transactions) erode customer trust — precision matters as much as recall.

🔗 Blockchain — All Angles Tested

Describe how blockchain stores data (4 marks):

1. Transactions grouped into a block (sender, receiver, amount, timestamp)
2. Each block stores the cryptographic hash of the previous block → forms the chain
3. Each block has its own hash — tampering changes the hash and invalidates all later blocks
4. Stored as a distributed ledger — identical copies across many nodes; consensus mechanism required to add new blocks

Drawbacks (1 mark each — must be described, not just named):

• High energy consumption — Proof of Work consensus requires enormous computational power
• Storage and scalability — entire chain must be stored by all nodes; grows indefinitely
• Transactions irreversible — errors cannot be corrected once confirmed
• GDPR conflict — right to erasure is impossible on an immutable blockchain

Smart contract (4 marks):

Self-executing program stored on blockchain → defines trigger conditions → when conditions met (via oracle) → automatically executes action without human intervention → result permanently recorded.