MBA Alumnus and World-Renowned Scientist Joe Valacich Discusses Fraud-Detection Software in Grad Class
“I was an MBA here, too,” Joe Valacich, a world-renowned scientist and head of Neuro-ID’s research operations, told Prof. Cameron Lawrence’s graduate Management of Information Systems class earlier this month.
Valacich is co-inventor of Neuro-ID's patented technologies and also a professor at the University of Arizona, but he returned to UM to give a guest lecture. “It’s great to come back to Missoula. I love this place,” he said.
The company he cofounded, Neuro-ID, merges state-of-the-art human interface sensor science and big data technology. To put it simply, it can detect lies.
“About five years ago, I was working on a project for a service intervention on the web,” Valacich said. The object of his work was to weed out users who were committing fraud.
Fraud impacts nearly every aspect of modern life. “This is why we’re going after fraud,” he said.
Valacich began by gathering the data stream and looking at cursor locations as users filled out an online form for insurance. What he saw was behavioral conflict. That is, the cursor movements of people filling out the forms changed when they were about to lie. According to Valacich, “What happens is they slow down and get much less accurate.”
In 2012, amidst buzz about innovative eye-tracking and thermal imaging technologies, Valacich explored the possibility of using a computer mouse, typing and touch screens as the next-generation polygraph.
This idea became the basis of extensive software development, dozens of research studies involving thousands of human subjects and multiple patent applications. And it led to the founding of Neuro-ID.
Neuro-ID’s software is incredibly accurate. It detected 48 out of 53 people who committed fraud in an insurance claim scenario. It is also scalable, secure, un-biased, risk model-adapted and flexible. “We can put it into anything,” he said.
Valacich attributes much of his success to the power of the Cloud and hard work. When asked what advice he would offer the MBAs on starting a business, Valacich offered, “It will be harder than you ever imaged.” He also gave a nod to his education: “It is amazing what going to college can do for you.”