Abstract: The invention comprises a method and system of detecting and identifying fraud arising from a healthcare claim. The system includes a storage means for storing a data base containing source data related to a healthcare claim. A memory means is used for storing a set of user-defined rules for detecting and identifying fraud. A processing means is coupled to the storage means for comparing the source data to the set of rules in the memory means. If the source data violates the set of rules, the relevant portion of the source data is identified and flagged as fraudulent data. The flagged data is then forwarded to a special investigator for a comprehensive analysis. The fraudulent data is transformed to graphs and charts to illustrate patterns so that the fraud is easily detected and identified.