Chapter: 6

Fraud Trends in iGaming

As iGaming becomes more popular around the world, fraud attacks are an increasing threat to online gaming platforms as well as their legitimate players. Here is a short list of the most common fraud schemes that are a serious threat to iGaming companies:

Multiple Account Fraud and Bonus Fraud

Also called multi-accounting, multiple account fraud is when criminals use fake or stolen credentials to create multiple accounts, which they then use for various schemes. In bonus fraud, fraudsters exploit sign-up bonuses to stack their multiple accounts with free chips or other credits. This enables them to carry out further scams, such as using the free credits to place bets on all possible outcomes to ensure a win (match betting), using multiple accounts to join the same table to help one of their accounts win (gnoming), and intentionally losing in order to transfer money from one account to another (chip dumping).

Affiliate Fraud

Affiliate fraud is when fraudsters use deceptive tactics to gain personal profit from affiliate marketing programs. Examples include using stolen data to generate fake sales, creating or hijacking domains that are similar to the brand of a company (typosquatting), and using adware to insert affiliate codes automatically. This can be a serious problem for iGaming platforms who use affiliate marketing to help attract new players to their site.

Account Takeovers

Account takeover is a strategy used by fraudsters to gain unauthorized access to player accounts and make unauthorized purchases. Typically, once the fraudster gains access to the account, they change the password to lock out the account’s true owner and proceed to drain the account. This can compromise platform security and cause financial losses as well as damage to player trust.

As a result, many gaming operators are now deploying stricter forms of user authentication to ensure that the player logging into an online account is the actual player. Biometric authentication is growing in importance because of this emerging fraud vector.

Payment Fraud

Fraudulent transactions pose significant financial risks to iGaming companies, affecting their operations and reputation. Fraudsters often use stolen credit card information to buy credits, leading to chargebacks. Another emerging type of payment fraud is abuse of mobile top-ups. Fraudsters may use a VPN to spoof their location in order to exploit regional discounts on topping up. Or they might con an unsuspecting user into topping up the fraudster’s gaming account.

Essential Guide to Online Identity Verification for the Gaming Industry

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Disclaimer: This report contains information only for educational purposes and is not intended to be legal or financial advice. Readers are encouraged to do their research and seek professionals in these fields for more guidance.

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