Top 10 Ecommerce Fraud Detection Software & Tools

Here’s how it works:

As soon as shoppers arrive at your store, SEON immediately begins collecting data behind the scenes. You choose the data points to focus on and enrich, such as IP address, email address, phone number, and device. SEON also lets you check 90+ platforms and social media networks for linked profiles and open-sourced customer info. This allows you to learn hundreds of insightful data points about the customer without interrupting their shopping experience by asking them.

All the data is fed through risk rules, which are customizable. SEON also features a whitebox machine learning engine that will learn from your customers and activity and suggest new rules that will work for your business in particular. As you flag more fraud cases, the system learns to recognize suspicious patterns in your particular website users and usage.

The goal is to reduce fraud at every stage, whether it’s a login, sign-up, or payment, by giving you complete control of your risk appetite. This helps reduce false positives. You can also use all the collected data to dispute chargebacks and prove you’re addressing friendly fraud.

SEON Pros

• Frictionless digital footprint analysis: Aggregates real-time data from 90+ social networks and platforms so you can quickly see if you’re dealing with a real person or not. Also uses dynamic friction, only asking shoppers for extra information when necessary.
• Spot connections between accounts: Multi-accounting and bonus abuse challenges? SEON can take down entire networks of fraudsters by highlighting links between their accounts, as well as suspicious setups.
• Flexible integration: Use SEON on its own, or pick and mix any APIs you need to integrate with your existing tech stack. Or use SEON’s Shopify app, Chrome extension, Zapier integration, or user-friendly end-to-end Admin Panel interface.

SEON Cons

• No chargeback guarantee: SEON believes that the chargeback guarantee model is an incentive to create too many false positives. If it’s this model you are after, there are better alternatives.

As an ecommerce business, you’ll probably need the Commerce Protection Platform, which offers a mix of account protection, abuse prevention, and payment optimization. It is built upon Signiyd’s Commerce Network, which is a shared intelligence database designed to gather transaction data from thousands of global ecommerce retailers.

Signifyd Pros

• Enterprise ecommerce specialists: Larger retailers should find themselves at home with Signifyd. 
• Data enrichment: You can aggregate external data based on an email address or phone number.
• Powerful integrations: Signifyd works seamlessly with Salesforce, Shopify, and Magento. 

Signifyd Cons

• No reverse social media lookup: While you get some data enrichment, you won’t be able to learn anything from social networks and similar platforms.
• Blackbox machine learning model: Blackbox models aren’t explainable, which means that they’re not as easy to improve upon, and the reasons behind false positives are not transparent.

As a bonus point, Kount was acquired by Equifax in February 2021, which means you’re very likely to see integrations with other tools from the UK’s leading credit scoring provider in the future.

It’s also worth noting that Kount can integrate directly with online commerce platforms such as WooCommerce, Shopify, and Magento, among others.

Kount Pros

• Strong chargeback prevention focus: A lot of the data points Kount has gathered over the years are designed to help prevent chargeback fraud.
• Protects the entire customer journey: From signup to checkout and even authentication at login, you can calculate risk at every step.
• Customizable solution: One reason Kount works just as well for online stores as banks is that you have complete control over how you mitigate risk.

Kount Cons

• No phone or social media lookup: You’ll get tons of data pertaining to payment but not much extra info to complete a customer profile.
• Opaque pricing: The chargeback guarantee model can be loved or loathed by online stores, but everyone agrees that hiding pricing behind sales calls is a downside.

As you can imagine, a key advantage of having this whole suite of products is that they seamlessly integrate with each other and that most of them offer enough customization options to adapt the tools to your risk managers’ needs. 

A noteworthy addition to its product line is Sift Connect, which lets your online store connect more fraud prevention and risk management solutions from third-party payment solutions, such as Adyen, Braintree, and Stripe, among others.

Sift Pros

• Specialist chargeback module: It should offer peace of mind to online retailers who want to see results out-of-the-box.
• Data enrichment and machine learning (ML): Reduce user friction by adding external data to your user profiles and feeding the results to a powerful ML system.

Sift Cons

• Blackbox AI: Sift is great at calculating risk. But how, exactly? It’s not always clear because of the opaque nature of its blackbox algorithms.
• Less-than-ideal integration: Some reviewers report lengthy deployment and difficulty in combining Sift products despite the availability of APIs.

In practice, this is done via standard IP and device analysis, along with behavior tracking and user authentication. The key point to note is that Cybersource takes a bit of an all-or-nothing approach, which means you’ll have to handle both payments and risk management with the company.

Cybersource Pros

• Payments and payment protection: The partnership with Visa makes it an attractive proposition if you need to start accepting payments on your site with peace of mind.
• Additional payments services: You get fraud and risk management, but also extras such as payouts, global tax calculation, and currency conversion for CNP, buy now pay later (BNPL), e-wallets, direct debit, and more. 

Cybersource Cons

• Full integration required: Cybersource is at its best when you use it for payment acceptance and fraud prevention – meaning it’s not ideal for a multi-layered ecommerce fraud prevention approach such as a risk stack comprising various tools.
• Not suited for small and medium businesses (SMBs): Smaller online stores with low to medium-volume transactions could be deterred by Cybersource’s lengthy and expensive contracts.

Three products comprise Arkose Labs’ main fraud prevention solution: Arkose Detect, Arkose Protect, and Arkose Response. With all three integrated into a company’s security stack, Arkose Labs is so confident in its ability to prevent scaled automated attacks that it offers a Service Level Agreement with up to $1 million in loss reimbursement for successful credential stuffing attacks. 

This unique level of assurance is built off the back of the adaptive step-up challenge security architecture, where users with bot-like behavior are asked to complete puzzles to confirm they are human. This is complemented with fraud detection APIs to assess users based on their devices, IP, or point of connection, and behavioral analytics like velocity checks, which are fully explainable by whitebox machine learning.

Arkose Labs Pros

• Guarantee against automated attacks: Offers ZeroBot guarantee against automated attacks, effectively controlling ATOs, website scraping, scaled new account fraudsters, and card testing.
• Reimbursement for credential stuffing losses: Up to $1 million in reimbursement for successful bot attacks.
• Anti-web scraping capability: As it specializes in automated bot attacks, Arkose Labs also offers website security to protect from data scraping.

Arkose Labs Cons

• Rulesets not immediately customizable: Arkose’s 24/7 security operations center (SOC) support has to be contacted to implement changes, rather than you being able to adjust sensitivities in the software yourself. 
• Requires a dedicated team: Despite automation, a dedicated fraud analyst team is necessary for it to function optimally.

Inspired by the security of blockchain technology, Covery’s main fraud solution is powered by a huge database of over 400 million reputation records, which it uses to cross-check incoming traffic for fraud identifiers. Covery leverages both data-based risk scoring and reputation databases to run lookups that prevent fraud and provide other services like mitigating the cost of hard Know Your Customer (KYC) checks and precluding chargebacks. 

The Covery product also boasts a high level of user-friendliness. It is easy to integrate into existing CRMs, and existing users appreciate the response time for risk decisions and the customizability of available risk rules.

Covery Pros

• Blockchain-inspired data storage: Leverages a database of 400 million risk identifiers secured by blockchain technology, called Trustchain.
• Versatile integration capabilities: Fast returns on API calls, resourceless ML model development tools.
• Clever tools to mitigate chargebacks: Costs associated with hard KYC and chargebacks are monitored by the Visa Merchant Purchase Inquiry (VMPI) and Ethoca chargeback prevention tools.

Covery Cons

• Potentially stale data: Although Trustchain checks are conducted in real-time, the actual information contained within does not update in real-time, and is thus less reliable than data sources that do.
• No reverse phone or email lookups: These data points can generate unique signs of a trustworthy or malicious user, such as an old family email account, or connecting via a virtual phone.

Though specializing in telecommunications, digital wallets, and airlines, Vesta is also offered downscaled for customers who need fraud solutions for individual storefronts on Shopify or Magento. The brand’s payment guarantee model is offered in both enterprise and standard solutions.

Vesta Pros

• Moneyback guarantee: Vesta reimburses its customers for any false negatives that turn into fraud events.
• Huge proprietary databases: By partnering with big data brands, Vesta can draw on huge amounts of data for fingerprinting and risk identification.
• Extensive experience in telecoms: Offers modules specifically for CNP payments in a telecom ecosystem for both individuals and enterprises.

Vesta Cons

• No customizable risk parameters: Though the risk parameters are expertly tailored to individual companies, the risk rules cannot be adjusted on the fly.
• No pattern recognition: Insights generated by the software do not look for patterns to detect data anomalies that could indicate an attack or an entire fraud ring. 

In addition to a user experience (UX) that is designed to let fraud teams make the most informed decisions on manual reviews, Nethone also provides each customer with an assigned data scientist. This expert’s job is to help adjust and design ML rules that further tighten the security of any digital payment infrastructure.

Nethone Pros

• Dedicated data scientist: Customers are assigned a team member to help adjust and create custom rules.
• Whitebox machine learning: Provides fraud teams with explainable risk metrics.
• Extensive fraud databases: The Profiler tool references a huge number of collected data points, including behavioral analytics, social media accounts, and IP and device fingerprinting.

Nethone Cons

• No free stack integration: Integrating the Nethone fraud solution product into an existing security stack comes at a premium.
• No social media profiling: Nethone does not utilize digital footprints, which can deliver clear signs of a user’s true intentions.

It’s also worth noting that the company’s Account Opening and Pro Insight APIs can help retailers who have a more thorough onboarding process. If you want to build a solid base of loyal customers, verifying their identities – and transactions – with Ekata is a great option.

Ekata Pros:

• Leverages Mastercard’s payment data: Using the network effect, Ekata can help you spot suspicious transactions before they turn into a chargeback request.
• Graph visualization: If you suffer from multi-accounting or bonus abuse issues, spotting customer connections with Ekata’s Identity Graph product could help.

Ekata Cons:

• US-centric: Although Ekata’s data on emerging markets is increasing, it is better suited to ecommerce companies based in North America.