(Disclaimer: I'm an engineer at Sift Science). For online purchases (card-not-present transactions), the merchant takes on all of the fraud risk. This means th

(Disclaimer: I'm an engineer at Sift Science). For online purchases (card-not-present transactions), the merchant takes on all of the fraud risk. This means that the banks do not have much incentive to protect against fraud. The merchants must go on the information they have, which probably doesn't include the card holder's verified phone number. Sift Science has been successfully protecting online businesses for over a year, and it turns out that machine learning is (unsurprisingly) a good tool for this sort of classification problem.