Proactive signup fraud blocking
for Stripe SaaS at scale

The math of fraud prevention for SaaS is brutal but simple: a chargeback costs $15-$50 in fees. A fraudulent trial signup that never converts costs you nothing. Every dollar spent preventing fraud at signup saves you multiple dollars in chargeback fees downstream. Yet most founders treat fraud prevention as a back-end concern, monitoring chargebacks after they land and refunding reactively. This is like waiting until your house catches fire to install smoke detectors. By the time you see a chargeback, you've already lost the transaction, paid processing fees, and contributed to a dispute rate that could eventually close your Stripe account. The only rational fraud strategy is prevention at the front door.

Card testing is the most common fraud pattern at signup. A fraudster uses a bot to test stolen credit card numbers at scale. They sign up with a disposable email address, run the card through your payment processor, and if it goes through, they mark that card as valid and sell the list to other criminals. A single compromised card can generate $50-$300 in fraudulent charges before the actual cardholder notices and files a chargeback. Most card testers use telltale signals: disposable email domains like tempmail, 10minutemail, or mailinator; plus-addressed emails like "john+test@gmail.com"; or numeric-heavy email patterns. These signals cost almost nothing to check, and catching them blocks 80%+ of obvious fraud before it reaches your payment processor.

The second fraud layer is behavioral velocity. A single fraudster testing cards will often run dozens of signups in minutes, all from the same email domain. If you see 10 signups in 5 minutes from similar email patterns, that's not a coincidence — that's a bot. Velocity checks are stateless and fast, requiring only an in-memory lookup of recent signups. Combining email pattern analysis with velocity checking catches almost all automated fraud attempts without adding latency or false positives for legitimate users. The goal isn't zero fraud (impossible) or zero false positives (unnecessary). The goal is to eliminate the low-hanging fruit — automated testing, disposable emails, obviously risky patterns — so your chargeback rate stays below dangerous thresholds.