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Benford's Law Part 1 - How to Spot Tax Fraud

Benford's Law Part 1 - How to Spot Tax Fraud

Created by Intuitor.com, this page explores Benford's Law: "For naturally occurring data, the digits 1 through 9 do not have equal probability of being the first significant digit in a number; the digit 1 has greater odds of being the first significant digit than the others." This law can be used to catch tax fraud because truly random numbers used by embezzlers do not meet this condition. This is an interesting look at a less than well known statistical method. It becomes more interesting because the authors apply it to this specific use.

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