Some platforms make it sound like their built-in fraud filter has everything covered. But the reality is different once orders start rolling in. Basic filters miss things, like new account fraud, synthetic identities, or repeat friendly fraud offenders. And by the time the chargebacks hit, it's already too late.
If your current setup feels like it's only catching the obvious stuff, it might be time to layer smarter fraud tools on top. Here's how to know when your platform filter isn't cutting it, and what to do next.
When Your Built-In Fraud Filter Starts Falling Short
Most e-commerce platforms come with basic fraud screening, usually covering things like:
- AVS (Address Verification System) checks
- CVV confirmation
- IP risk scoring
- Velocity checks on card usage
That's a solid starting point. But fraud tactics evolve fast. These filters only go so far when you're dealing with:
1. Repeat Friendly Fraud
Customers who file chargebacks after receiving their order can pass every standard check. Built-in filters won't spot these patterns of friendly fraud, especially if the buyer has no history with your store.
2. Synthetic Identity Fraud
A made-up identity using real and fake data can pass basic checks. Standard platform filters often don't flag suspicious combinations of new phone numbers, email addresses, or device fingerprints.
3. Bot-Driven Attacks
Some filters are too slow or simplistic to keep up with automated attacks that flood your checkout with small test charges or fake signups.
4. Risky Cross-Border Orders
Filters on platforms like Shopify or WooCommerce may flag high-risk countries, but don't assess IP mismatch, proxy use, or behavior anomalies in real-time.
Signs You Need a Stronger Fraud Filter Setup
If you're seeing any of these, your fraud stack needs an upgrade:
- Chargeback rate creeping above 0.9%
- Manual review time increasing
- False declines on good customers
- Higher refunds due to disputes
- Fraud losses growing faster than sales
Even if your processor hasn't warned you yet, staying below dispute thresholds (like Visa's 0.9% or Mastercard's 1.5%) matters for long-term account health. A weak filter puts your merchant account at risk.
When to Layer Third-Party Fraud Tools
Adding a third-party fraud tool isn't about overcomplicating things; it's about controlling what your platform can't. Here's when to add one:
You Sell Digital Products
Instant delivery means there's no room for manual review. You need behavioral and device intelligence to stop fake buyers before delivery.
Your Orders Come From Mixed Channels
If you sell through Shopify, marketplaces, and your own site, a single fraud system lets you track risky behavior across all entry points.
You've Been Added to VDMP
Visa's Dispute Monitoring Program flags merchants with high fraud ratios. If you're already listed, it's not optional because you need a plan to cut those rates fast.
Your Product Attracts Repeat Abusers
High-value items, subscriptions, or one-time-use goods (like gift cards) often attract serial refunders. Standard filters won't catch patterns across multiple identities.
What to Look for in a Stronger Fraud Filter
Third-party tools give you more control, especially if they include:
- Machine learning risk scoring
- Behavioral analytics (mouse movement, click speed)
- IP and device fingerprinting
- Blacklist and allowlist management
- Custom rule sets
- Real-time alerts for suspicious orders
Some even integrate with pre-dispute alert networks, giving you a heads-up before a chargeback gets filed.
Conclusion
Built-in fraud filters do their job, until they don't. If you're seeing too many chargebacks, more manual reviews, or more risky traffic, it's time to step up your protection. A layered fraud filter setup helps you catch what your platform misses and gives you better control over who gets through the checkout.
Don't wait for your chargeback rate to trigger a processor warning. Tighten your fraud defenses before it costs you sales, or your account.
FAQ: Fraud Filter Built-In Tools
What's the difference between a fraud filter and a chargeback alert?
A fraud filter stops risky orders before they go through. A chargeback alert warns you after a customer disputes the transaction, giving you a chance to refund before it becomes a chargeback.
Is Shopify's fraud filter enough?
Shopify's built-in system works for basic fraud, but it doesn't include advanced behavior tracking or identity verification. Many merchants eventually layer additional tools.
How do I know if I need a third-party fraud tool?
If your chargeback rate is rising, you're spending more time on manual reviews, or your fraud losses are growing, that's usually a sign your current filter isn't strong enough.
Can I use multiple fraud tools at the same time?
Yes. Many merchants use a fraud prevention tool alongside their platform's built-in filter and a chargeback alert system. Just make sure they don't conflict with each other.
Will a better fraud filter reduce chargebacks too?
Yes. Most chargebacks start with a fraud risk that wasn't caught in time. Blocking bad orders early keeps your dispute rate lower and protects your processor standing.
Chargeblast Can Help You Catch What Filters Miss
Chargeblast doesn't just handle chargebacks; it helps you spot early warning signs before they become a dispute. With integrations for real-time fraud alerts, dispute response automation, and network coverage across major processors, you stay in control no matter how sneaky the fraud looks.
Ready to fix what your fraud filter isn't catching? Book a demo below.
