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Industry Spotlight: Credit Scoring

In the U.S., credit scoring is dominated by three companies – Experian, TransUnion and Equifax, employing roughly 30,000 people. An important player in the scoring methodology is FICO, previously Fair Isaac Corporation, and the scores are typically called “FICO scores.” Credit scoring is the oldest application of predictive modeling, fulfilling a need that has beenContinue reading “Industry Spotlight: Credit Scoring”

Industry Spotlight: The IRS is Watching You

The IRS (U.S. Internal Revenue Service) has been using computers to choose tax returns for audit since 1962. Early on, the selection was rule-based, but the IRS turned to statistical modeling in 1969, using the oldest predictive analytics model in the toolbox – discriminant analysis. Discriminant analysis, a linear classification technique, was first proposed byContinue reading “Industry Spotlight: The IRS is Watching You”