Abstract: A method for monitoring merchant website transactions generated by affiliate marketing sources to detect fraudulent affiliate transactions involves obtaining transaction data for multiple on-line transactions, processing the transaction data using an affiliate separation module to separate the transactions based on affiliate identification, grouping the transaction data by affiliate source, analyzing all transactions corresponding to each affiliate using first algorithm that determines whether transaction data for each of said transactions matches pre-defined parameters that are consistent with fraudulent activity, determining the percentage of suspicious transactions relative to all transactions using a second algorithm, and identifying an affiliate as potentially fraudulent if said percentage of suspicious transactions exceeds a predetermined percentage.