Fraud Management Overview

Find and stop suspicious transactions

Help prevent fraudulent transactions and improve your efficiency with Fraud Management Filters – a free service for PayPal merchants that screens every transaction according to settings you define.

How it works

You decide how to set Fraud Management Filters to fit your business needs. High-risk transactions are denied, held pending for your review, or approved but flagged for your attention. You can screen by:

  • Maximum transaction amount - set your desired maximum purchase amount
  • Unconfirmed address - not yet confirmed as belonging to the account holder
  • Country of origin - payments from countries you think pose a business risk
  • Address Verification Service - billing address that doesn’t completely match the credit card issuing address or can’t be found
  • Card security code mismatch - payments that don’t include a correct code

It’s easy to set up:

  1. Select Fraud Management Filters from your PayPal Profile
  2. Choose your filter settings on the Edit My Filter Settings page

If you’re using PayPal Payments Pro, you can add additional customizable settings for even greater control by upgrading to Advanced Fraud Management Filters.

Options and Settings

Risk Control Options

Each Risk Control can be modified to suit your business needs:

Country Monitor: From a list of countries PayPal supports, create your own list of Monitored Countries, which are countries you wish to accept payments from. Automatically decline or accept these payments, and have them flagged for your attention.

Maximum Amount: Choose a maximum amount for payments you receive. Decline, accept, or accept and monitor payments above that amount.

Unconfirmed Address: This filter screens for payments above the specified amount when the shipping address entered by your customer has not yet been confirmed by PayPal as belonging to the PayPal account holder. A confirmed address is less likely to be used for fraudulent activity; however, there are many valid reasons why a customer's legitimate address may not be confirmed. For example, the customer may have recently moved or may live in a country where address confirmation is not available. Currently, only addresses in Canada, the United Kingdom, and the United States can be confirmed. You can also specify a maximum amount for the payment, in which amounts lower than the specified amount are not checked. The Unconfirmed Address filter applies to all payments.

Note: All payments made using credit cards and Virtual Terminal are considered to be from unconfirmed addresses.

Address Verification Service: This filter screens for payments for which the billing address entered by your customer doesn't match the information maintained by the card issuer, as determined by the Address Verification Service (AVS). An AVS match helps verify that the customer using the credit card is the owner of the card.

Card security code mismatch: This filter screens for payments that do not include a correct Card Security Code. The card security code is a three- or four-digit number usually found on the signature panel of a card.

For more information

Risk Control Settings

Payments matching your risk criteria are automatically handled according to your settings. Choose from three settings for each Risk Control:

Decline: Automatically declines payments matching the risk criteria. Buyers receive a gentle, generic decline message that does not reveal your settings. Payments appear as Declined in your Transaction History and are shown on your Risk Report.

Accept and Report: Automatically accepts payments matching the risk criteria, but marks them for your attention. Payments appear as Risk Alerted in your Transaction History and are shown on your Risk Report. Payment confirmation emails you receive flag the payment as Risk Alerted.

Accept: Automatically accepts payments matching the risk criteria. Payments appear normally in your Transaction History and are not shown on your Risk Report.

Risk Controls: Risk Report

Track and adjust your exposure to risk

When you activate Risk Controls, you'll gain access to an online Risk Report that summarizes the risk of payments sent to your account. View payments accepted and declined by each Risk Control during the past 7 days. Monitor the percentage of risky payments, and adjust your Risk Control settings accordingly.

You can also track risk through your PayPal Transaction History. The status of each payment reveals how it was handled by your Risk Control settings. Use our Risk Search to find payments that matched your risk criteria. See which Risk Controls the payment triggered - and whether it was declined or accepted and reported to you.