A startup called Sift Science says it can help your website battle fraud in 30 minutes or less.

And the San Francisco-based company closed a $5.5 million funding round today from quite a list of high-profile tech investors.

The cofounders have developed an algorithm that pinpoints one million patterns that help predict, and potentially prevent, incidences of fraud. For instance, those who type text in all caps are almost five times more likely to be fraudsters.

Investors included Salesforce CEO Mark Benioff, Expedia founder Richard Barton, Posterous’ Garry Tan, former Paypal CTO Max Levchin (who led the seed round), Tapjoy cofounder Lee Linden, Y Combinator, First Round Capital, SV Angel, Union Square Ventures, and Reddit’s Ohanian.

Fraud image via Blazej Lyjak// Shutterstock

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Dabble in online dating? It turns out that the crippling fear of an awkward first date is the least of your troubles. A fraud is sweeping online dating sites, according to a special report in this month’s issue of Glamour Magazine.

The scam typically works like this: A con artist, usually based in an Internet cafe overseas, will lift a photo from Facebook or another social networking site. They will painstakingly craft a fake profile and begin targeting people that are looking for love.

Once they’ve made contact, they will typically request to move the conversation to a private instant messaging service. He or she will begin the courtship process by sending letters and love poems for a period of weeks and finally offer to fly to meet their victim. Within hours of the expected arrival time, an emergency will strike: A work visa has expired, or their aunt/niece/child is sick and they need a few thousand dollars to be wired over so they can finally meet their intended.

In many cases, scammers will choose to use pictures of military personnel. After discovering that his headshot consistently showed in hoax dating profiles (thanks to a Google alert), Army Master Sgt. C.J. Grisham set up a personal blog for soldiers to report their photo being used on online dating sites.

“Over the past few years, I’ve seen these scammers use all kinds of photos removed from open Facebook pages, blogs, official military websites, and command pages,” he wrote in a blog post last month. “I’ve also seen my own photos and name used.” (The image of Grisham that was used by scammers is pictured, left)

With a few of the largest player like OKCupid, Match, and others, there are precautionary measures in place. However, on smaller or niche dating sites like christiandatingforfree.com and datanta, there is no security system to spot a fraudster.

[Update: the site christiandatingforfree.com contacted us to notify us of the precautions they have in place, including a human editor who responds to complaints and reports, and ThreatMetrix, a cybercrime prevention software.]

“On some dating sites, as many as one out of 10 profiles is a scammer,,” Mark Brooks, editor of Online Personals Watch told Glamour.

The lesson here is that online dating startups will need to step up their game to keep consumers safe. “In the war against online dating scams and security threats, we’ve chosen to do whatever is necessary to always be a few steps ahead of scammers, and not the other way around – which is usually too late for our users,” said Cupid.com’s CEO, Bill Dobbie.

“This decision has its high price tag, but the alternative can be much costlier,” he continued. For this reason, Cupid.com, the online dating network behind Flirt.com and BlackMatch.com, announced a partnership this month with RecSys Ltd, an anti-scammer technology. The goal is to catch them 35 percent faster.

With the new system, any individual identified as a scammer is added to the master database, which other online dating companies can access. To identify rogue behavior, the algorithm factors in the user’s login location, IP address, profile photo, and behavior patterns. Additionally, the system can detect “bots,” often operated by organized crime gangs, which create profiles and engage real members in automated scripted conversations designed to elicit payment.

Already, through its quality assurance methods, the site has identified 20,000 scammers who get permanently blocked from Cupid’s communities each month.

Here are some expert tips on avoiding scams from Cupid.com’s Communications director, Sean Wood:

• Military pictures should turn on your scam radar warning. Some of the biggest scams occur from supposed soldiers in the armed services with a believable sob story and a desperate need to settle down.
• Try and keep the conversation going on the dating site messaging system rather than being dragged off to Skype or MSN, at least initially.
• Employ some basic conversational tests: If the person claims to be local, engage in a local-knowledge conversation (e.g. the weather, some nearby event, sports team, TV, or festival) and watch for mistakes. If the person is not claiming to be local, consider why he or she would want a long-distance relationship. Is there good reason, such as some particularly unusual common ground? If not, why aren’t they restricting themselves to people a bit nearer to their current location?
• Look out for words like “dear” and old-fashioned romantic language, as well as badly formed sentences.
•  Never, ever send money to anyone on a dating site, and especially avoid wiring cash.
• Always be on the lookout for get-rich-quick schemes. If it sounds too good to be true, then it’s probably a scam.

Word of caution: The FBI recently issued a warning about a different kind of online dating scam known as “ransomware.” It’s a virus that will make your computer inoperable until you hand over a payment. Read more about the ransom scam here. 

Have you ever been a victim of an online dating scam? To protect consumers, sites like romancescam.com are being set up for volunteers to post details of the counterfeit dating profiles they come across. Christine Davis, a design student who was duped by a fake profile, set up this particular site and wants to support others who have been targeted. Davis calls it the “Nigerian advance fee scam,” as it is thought that the majority of spammers are based in Western Africa.

Hacker image via Shutterstock

Its flagship product, FraudNet, combs through the Internet to make sure people trying to process transactions or open bank accounts aren’t using stolen information.

Georgian Partners led the round, with Kleiner Perkins Caufield & Byers, Norwest Venture Partners, and Jafco Ventures participating. The full press release follows:

41st Parameter, the global leader in device recognition for fraud prevention and online audience identification, is pleased to announce $13M in Series D financing. Georgian Partners joins Kleiner Perkins Caufield and Byers (KPBC), Norwest Venture Partners (NVP) and Jafco Ventures in recognizing the growth potential for 41stParameter’s cloud-based device recognition technology.

The new funding will be used to further fuel R&D – focused on both the flagship FraudNet platform and the AdTruth the pro-privacy digital media device recognition division. In addition, the funds will be used to support 41st Parameter’s expansion as it builds up its presence in Silicon Valley and grows its sales and customer operations around the world.

41st Parameter has seen strong momentum for its FraudNet fraud detection and prevention platform within some of the world’s largest enterprises. The company is one of the fastest growing players in the industry, with 40% year over year growth in H2 2011 while building a record pipeline of deferred revenue. On the AdTruth side of the business, 41st Parameter is solving the audience identification, targeting and consumer privacy needs of a rapidly evolving global digital media industry across desktop, mobile and other emerging platforms.

“41st has built an impressive reputation as an industry leader by using applied analytics to recognize and prevent fraud,” said Justin LaFayette, a managing partner at Georgian Partners. “They have also been successful in applying their established device recognition technology to the complex world of digital media. 41st Parameter is a perfect example of maximizing R&D investment across multiple market categories.”

“As electronic and online payment methods continue their rapid growth, there is – and will continue to be – a critical need to identify and stop fraud in the global ecommerce, banking and travel industries,” said Alan Naumann, chief executive officer at41st Parameter. “Coupled with the demand in the digital media space, we have a real opportunity to solve two critical business problems with our best-of-breed core technology. We’re excited by the challenge and thankful for the support of our investors.”

As mentioned above, 41st Parameter will use these new funds to:

• Continue to develop new functionality for FraudNet – the leading anti-fraud solution used by 75 percent of the world’s top banks, two thirds of the world’s largest airlines, more than 120 of the top global ecommerce brands and thousands of SMB ecommerce retailers, 41st Parameter continues to innovate to stay ahead of current and emerging threats.
• Establish AdTruth as a leader in pro-privacy device recognition – already able to solve many of the audience identification challenges for desktop and mobile advertisers, including those caused by Apple’s recent decision to deprecate UDID. AdTruth has also been widely recognized for its efforts to meet the needs of digital marketers while adhering to global privacy regulations and respecting consumers’ desire for greater transparency and control over how their personal information is used.
• Grow the company’s presence in Silicon Valley, attracting top engineering talent.
• Expand worldwide sales channels – further strengthening and extending direct sales operations and channel partners around the world.

“These are exciting times for 41st Parameter,” continued Naumann. “The opportunities are there and our investors are behind us as we look to the future.”