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Benford’s Law – Using Maths to Catch Fraudsters

Benford’s Law is a very powerful and counter-intuitive mathematical rule which determines the distribution of leading digits (ie the first digit in any number).  You would probably expect that distribution would be equal – that a number 9 occurs as often as a number 1.  But this, whilst intuitive, is false for a large number of datasets.   Accountants looking for fraudulant activity and investigators looking for falsified data use Benford’s Law to catch criminals.

The probability function for Benford’s Law is:

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This clearly shows that a 1 is by far the most likely number to occur – and that you have nearly a 60% chance of the leading digit being 3,2 or 1.   Any criminal trying to make up data who didn’t know this law would be easily caught out.

Scenario for students 1:

You are a corrupt bank manager who is secretly writing cheques to your own account.  You can write any cheques for any amount – but you want it to appear natural so as not to arouse suspicion.  Write yourself 20 cheque amounts.  Try not to get caught!

Look at the following fraudualent cheques that were written by an Arizona manager – can you see why he was caught?   

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Scenario for students 2:

Use the formula for the probability density function to find the probability of the respective leading digits.  Look at the leading digits for the first 50 Fibonacci numbers.  Does the law hold?

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There is also an excellent Numberphile video on Benford’s Law.  Wikipedia has a lot more on the topic, as have the Journal of Accountancy.

If you enjoyed this topic you might also like:

Amanda Knox and Bad Maths in Courts – some other examples of mathematics and the criminal justice system.

Cesaro Summation: Does 1 – 1 + 1 – 1 … = 1/2? – another surprising mathematical result.

IB Revision

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If you’re already thinking about your coursework then it’s probably also time to start planning some revision, either for the end of Year 12 school exams or Year 13 final exams. There’s a really great website that I would strongly recommend students use – you choose your subject (HL/SL/Studies if your exam is in 2020 or Applications/Analysis if your exam is in 2021), and then have the following resources:

Screen Shot 2018-03-19 at 4.42.05 PM.pngThe Questionbank takes you to a breakdown of each main subject area (e.g. Algebra, Calculus etc) and each area then has a number of graded questions. What I like about this is that you are given a difficulty rating, as well as a mark scheme and also a worked video tutorial.  Really useful!

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The Practice Exams section takes you to ready made exams on each topic – again with worked solutions.  This also has some harder exams for those students aiming for 6s and 7s and the Past IB Exams section takes you to full video worked solutions to every question on every past paper – and you can also get a prediction exam for the upcoming year.

I would really recommend everyone making use of this – there is a mixture of a lot of free content as well as premium content so have a look and see what you think.

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IB Maths Exploration Guide

IB Maths Exploration Guide

A comprehensive 63 page pdf guide to help you get excellent marks on your maths investigation. Includes:

  1. Investigation essentials,
  2. Marking criteria guidance,
  3. 70 hand picked interesting topics
  4. Useful websites for use in the exploration,
  5. A student checklist for top marks
  6. Avoiding common student mistakes
  7. A selection of detailed exploration ideas
  8. Advice on using Geogebra, Desmos and Tracker.

Available to download here.

IB Exploration Modelling and Statistics Guide


IB Exploration Modelling and Statistics Guide

A 60 page pdf guide full of advice to help with modelling and statistics explorations – focusing in on non-calculator methods in order to show good understanding. Includes:

  1. Pearson’s Product: Height and arm span
  2. How to calculate standard deviation by hand
  3. Binomial investigation: ESP powers
  4. Paired t tests and 2 sample t tests: Reaction times
  5. Chi Squared: Efficiency of vaccines
  6. Spearman’s rank: Taste preference of cola
  7. Linear regression and log linearization.
  8. Quadratic regression and cubic regression.
  9. Exponential and trigonometric regression.

Available to download here.

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