The Covid-19 pandemic of the past year created an increase in the number of online customers as business owners closed, or limited access to their brick and mortar locations and migrated online, sometimes just to survive.

To no one’s surprise, the surge in online activity was accompanied by a major increase in the amount of e-commerce fraud. A recent study from Juniper Research* predicts those losses will total $20 billion in 2021, an 18% increase over fraud-related losses in 2020.

Cyber attackers acquire credit card information along with credentials and go on a shopping spree that costs merchants thousands in lost merchandise and chargeback fees when the order is later marked as fraud.

Here at Commonwealth Consulting Group, we’ve seen local reports of businesses experiencing as many as 150,000 – 300,000 transactions an hour in fraudulent sales resulting from automated threat actors using batches of stolen credit cards.

It’s Time for Increased Security Measures

We’d like to urge our clients to work with your website developer to re-evaluate your e-commerce security, determine where you might be most vulnerable, and consider adding one or more extra layers of security checks to your payment platform.

One such security measure would be a CAPTCHA test (see below) that helps your e-commerce platform distinguish between real customers and computer BOTS, such as Google reCAPTCHA, or a WordPress CAPTCHA plugin.

What is Captcha?

A CAPTCHA (Completely Automated Public Turing test to tell Computers and Humans Apart) is a type of challenge–response test used on a variety of websites that want to verify that the user is not a robot. The most common type of CAPTCHA requires someone to correctly evaluate and enter a sequence of letters or numbers perceptible in a distorted image displayed on their screen. The CAPTCHA test helps identify which users are real human beings and which ones are computer programs or BOTS. CAPTCHA works because computers can create a distorted image and process a response, but they can’t read or solve the problem the way a human must to pass the test.

Fraud Filters Can Help Protect Your Business

There are many other types of fraud filters you can set up, but some of the more common ones include:

• A daily or hourly velocity filter that controls how many sales may be submitted to your website over a certain period of time. This helps prevent fraudsters from testing credit card numbers after purchasing lists of stolen cards.
• An address verification system (AVS) where you set your fraud filters to decline or require review for orders where the billing and shipping addresses don’t match.
• A card verification value (CVV) filter that looks for discrepancies between a card’s CVV number and the one entered during checkout.
• A purchase amount filter that requires you to review all transactions that fall outside a certain range. Since most businesses know their typical transaction size, you can set the filter to alert you when a transaction is higher or lower than this amount.

Clear Messaging Reassures Your Customers

Remember, enhanced security measures are just as important for customer protection as they are for your business. Be sure to include clear messaging to let your customers know why you’ve increased security at checkout. That should go a long way toward preventing cart abandonment while lowering fraud risks.

* Morrow, Susan, and Nick Maynard. “Online Payment Fraud: Emerging Threats, Segment Analysis & Market Forecasts 2021-2025.” Research Report | Fintech & Payments, Juniper Research, 26 Apr. 2021,