Quick Guide on Blacklisting & Blocking Fraudulent Stripe Buyers

Online payment fraud is a growing threat, with global e-commerce losses expected to exceed $107 billion by 2029—more than double the $44.3 billion recorded in 2024. 

Fraudulent chargebacks, stolen credit cards, and policy abuse continue to impact merchants, with 42% of global fraud incidents occurring in North America alone. 

As fraudsters evolve their tactics, businesses relying on Stripe must take proactive measures to blacklist and block high-risk buyers before they cause financial damage.

Preventing fraudulent transactions isn’t just about stopping chargebacks—it’s about protecting your revenue, reducing disputes, and maintaining a healthy payment processor account. 

Our guide breaks down how merchants can use Stripe's built-in fraud tools, manual blocking methods, API security updates, and automation strategies to detect and prevent fraudulent buyers effectively.

Use Stripe Built-in Anti-fraud Tools

Stripe provides merchants with built-in fraud prevention tools designed to identify and block high-risk transactions before they lead to chargebacks or financial losses. 

These tools leverage machine learning, risk scoring, and customizable rules to help businesses mitigate fraud effectively.

Radar for Fraud Teams

Stripe Radar, powered by machine learning, analyzes billions of data points across the Stripe network to detect fraudulent patterns in real-time. 

It assesses risk factors like unusual purchasing behavior, mismatched billing information, and rapid transaction attempts to flag high-risk payments.

• Dynamic Risk Scores: Each transaction is assigned a fraud probability score based on Stripe’s network intelligence. Higher scores indicate increased fraud risk, allowing businesses to take preventive action.
• Machine Learning Adaptability: Radar continuously refines its detection model based on emerging fraud trends, improving accuracy over time.

Custom Rules & BlocklistsBusinesses can define custom rules within Stripe to automatically block suspicious transactions based on specific risk criteria.

• Blocking High-risk Countries: Merchants can prevent transactions from regions associated with high fraud rates.
• Flagging Velocity Attacks: Limits can be set on repeated payment attempts from the same card or IP address.
• Preventing Mismatched Data: Rules can reject payments where billing and shipping details do not match.

3D Secure (Strong Customer Authentication - SCA)Stripe supports 3D Secure (3DS), an additional authentication layer requiring cardholders to verify their identity before purchasing. This reduces fraud and shifts liability away from merchants in case of a dispute.

• Automatic 3DS Implementation: Stripe dynamically applies 3DS authentication when transactions appear high-risk.
• Reduced Chargeback Risk: Transactions authenticated with 3DS are less likely to be disputed successfully.

Real-time Fraud Alerts & MonitoringStripe provides instant alerts on suspicious transactions, allowing merchants to immediately act before processing the payment. Monitoring dashboards also provides insights into fraud trends, helping businesses refine their risk strategies.Manually Blocking Fraudulent CustomersWhile Stripe’s automated fraud detection tools are effective, merchants should also take manual steps to block fraudulent buyers. Proactively identifying and blacklisting high-risk customers can help reduce chargebacks and prevent repeat offenders from making transactions.Existing IPsFraudsters often use the same IP addresses to conduct multiple fraudulent transactions. Merchants should track and block IPs linked to chargebacks or suspicious activities.

• Monitor IP Activity: Review transaction logs to identify repeat offenders using the same IP addresses.
• Blacklist Known Fraudulent IPs: Use Stripe’s blocklist feature to prevent transactions from flagged IP addresses.
• Detect Proxy & VPN Use: Fraudsters often mask their real location using proxies or VPNs. Stripe can help detect these tactics, allowing merchants to block suspicious transactions.

News Potential Fraudulent Buyers Fraudsters constantly change tactics, making it essential to stay ahead by identifying emerging threats.

• Analyze Customer Behavior: Look for red flags such as multiple failed payment attempts, mismatched billing details, or unusually large orders from new accounts.
• Use Manual Order Reviews: If an order seems suspicious, verify details before processing. Contact the buyer, request additional verification, or delay shipment until confirmation.
• Leverage External Blacklists: Some fraud prevention networks maintain databases of known fraudulent buyers. Cross-checking new customers against these lists can help block scammers before they complete a transaction.

By manually blocking fraudulent customers and continuously updating blacklists, merchants can enhance fraud prevention efforts beyond automated detection, reducing chargeback risks and financial losses.Refreshing Your API KeysRegularly refreshing your API keys is a crucial security measure to prevent unauthorized access and protect against fraud. If an API key is compromised, fraudsters can manipulate transactions or gain access to sensitive payment data. Updating keys ensures that only authorized users and systems can interact with your Stripe account.Steps to Refresh Your API Keys in Stripe

1. Log Into Your Stripe Dashboard
   
   • Go to dashboard.stripe.com and sign in with your credentials.
2. Navigate to the API Keys Section
   
   • In the left-hand menu, select Developers → API Keys.
3. Create a New Secret Key
   
   • Click + Create secret key to generate a new key.
   • Label the key appropriately to track its purpose.
4. Update Your System with the New Key
   
   • Replace the old API key with the newly generated one in your payment processing system, server configuration, or any third-party integrations.
   • Ensure all services using the old key are updated with the new key to prevent service disruptions.
5. Revoke the Old API Key
   
   • Once the new key is successfully implemented, go back to the Stripe dashboard and revoke the old key to prevent unauthorized use.
6. Test Transactions to Verify Integration
   
   • Run a few test transactions to confirm that the new API key is functioning correctly.
7. Enable Role-Based Access Control (RBAC) (Optional but Recommended)
   
   • Limit API key access based on user roles to minimize security risks.
   • Use restricted keys instead of full-access keys whenever possible.

Regularly rotating API keys help prevent fraud, reduce the risk of unauthorized access, and strengthen overall payment security.Automate Your Chargebacks & Disputes with ChargePayManaging chargebacks and disputes manually is time-consuming and costly. ChargePay simplifies this process with AI-driven automation, allowing businesses to detect, prevent, and resolve disputes efficiently. By leveraging predictive analytics and automated workflows, ChargePay helps merchants reduce chargeback rates and recover lost revenue.How ChargePay Enhances Chargeback Management

1. AI-Powered Fraud Detection
   
   • ChargePay analyzes real-time transaction data to identify and flag suspicious activity before it leads to a chargeback.
   • Predictive algorithms assess risk factors, enabling businesses to take proactive steps, such as blocking fraudulent buyers or requiring additional verification.
2. Automated Dispute Response
   
   • The platform gathers necessary evidence, including transaction details, shipping logs, and customer interactions, to build a strong case.
   • AI-generated response templates ensure that each dispute is presented with compelling evidence, increasing the chances of winning chargeback cases.
3. Seamless Integration with Stripe
   
   • ChargePay connects directly with Stripe, automating dispute handling without requiring manual intervention.
   • Businesses receive real-time alerts and recommendations for resolving potential disputes before they escalate.
4. Operational Efficiency & Cost Savings
   
   • Automating chargeback management reduces manual workload, freeing up resources for other business operations.
   • Merchants experience fewer chargeback fees, lower dispute losses, and improved payment account health.
5. 99% Chargeback Elimination at the Dispute Stage
   
   • ChargePay’s AI-driven approach resolves disputes at the earliest possible stage, preventing them from escalating to costly chargebacks.
   • Direct partnerships with Visa, Mastercard, American Express, and Discover ensure effective dispute resolution.

By integrating ChargePay, businesses can minimize revenue loss, enhance fraud prevention, and maintain a strong payment processing reputation. Automating chargeback management is no longer an option—it's a necessity for long-term profitability and security.