A financial institution uses a deep learning model for fraud detection. The model is a feedforward neural network with three hidden layers. It was trained on a balanced dataset of 100,000 transactions. During deployment, the model achieves high accuracy on the test set but the fraud detection rate (true positive rate) is only 40% while the false positive rate is 0.1%. The business requires a true positive rate of at least 80%. Which of the following actions is most likely to achieve the required true positive rate while minimizing the increase in false positives?
Lowering threshold increases TPR; the optimal threshold can be chosen based on the precision-recall curve.
Why this answer
(increase hidden layers) may capture more complexity but does not directly increase TPR and could overfit. Option B (SMOTE) rebalances the training set, but the dataset is already balanced, so this is unlikely to improve TPR. Option D (L2 regularization) reduces overfitting but increases bias, which could lower TPR.
Option C (change threshold) is the most direct approach: lowering the classification threshold increases the true positive rate, and by tuning, it can achieve 80% TPR with a minimal increase in false positives.