If the captcha is broken on your server it is more likely that the php function "imagettftext" isn't available which is needed to convert a text into a captcha image file.
Basic GD functionality should be enabled on the server which is needed for image transformations.
For captcha functionality (rendering a text to an image file using a specific font file) you also need FreeType :
According to the php manual at: http://php.net/manual/en/function.imagettftext.php
"This function requires both the GD library and the » FreeType library."