onuses and promotional incentives are the iGaming industry’s lifeblood, fueling growth, loyalty and fierce competition in a market where margins are tight and marketing wars never stop. Beneath their shiny appeal, however, lies a darker truth: these customer-friendly offers have become a favorite playground for increasingly cunning fraudsters. What was once a tool to entice legitimate players is now a double-edged sword, cutting deep into operators’ profitability as bonus abuse rises to alarming levels. From fake accounts to stolen identities, fraudsters are exploiting these promotions in ways that demand immediate attention. Bonus abuse accounts for 16% of the fraud observed in the cross-industry LexisNexis® Digital Identity Network®. The question is no longer whether iGaming businesses will face this threat, but how they can outsmart it while continuing to delight their genuine customers. In 2023, gaming and gambling operators experienced a 103% increase in bot attacks, using automated scripts or programs to perform tasks on the internet at a much faster rate than a human could, according to the LexisNexis® Risk Solutions Cybercrime Report. The increase was primarily driven by growth in Europe, the Middle East, and Africa (EMEA) and North America. While in 2022, there was an alarming 345% increase in bot-driven account creation attacks in the gaming sector. Furthermore, fraudulent networks often collaborate across borders, sharing stolen credentials and exploiting digital ecosystems to maximize their reach and evade law enforcement. Crafty fraudsters weave a deceptive web, spinning multiple fake accounts to snatch up enticing offers, often using stolen or fabricated identities. Equipped with advanced tools like bots or identity-masking technologies, they bypass verification processes, exploit promotional mechanics and withdraw profits before detection systems catch up. Operators face an urgent and escalating challenge. How can they mitigate the risks posed by increasingly sophisticated fraud schemes without compromising their ability to deliver competitive promotions and an exceptional customer experience? Ti GhaemGirnogwBi no ng uTshAr eb autsoe f Bonus abuse’s prevalence can largely be attributed to the inherent appeal of “free money” promotions, such as welcome bonuses, free bets and deposit matches. For fraudulent actors, these offers present an opportunity to generate substantial financial gains and the tools at their disposal are becoming more polished and organized. An example of third-party fraud is when fraudsters set up multiple accounts with fake or stolen identities, often employing synthetic creation methods that use stolen personal data fragments to fabricate entirely new fake identities. To scale their operations, they leverage automated bots and orchestrate attacks across devices with untraceable proxies, VPN or TOR networks, which help them stay anonymous online by sending their internet traffic through multiple servers to hide their identity and location. In first-party fraud, people carry out multi-accounting by making minor modifications to their personal identity, such as creating multiple versions of their own email address, known as email tumbling, or in third-party fraud, by using a friend’s name and credit card. The impact of these activities goes far beyond financial loss from false bonuses and manipulated outcomes. Fraudsters’ tactics also compromise data integrity, clutter customer databases with unreliable information and erode legitimate players’ trust. IDnetteelcl it gi oenn ta Snodl uP trieovnesnftoi ro nF r a u d iGaming operators cannot afford to continue playing defense in the face of such sophisticated threats. Protecting customer incentives while safeguarding business operations demands a shift towards proactive, technology-driven solutions. The key lies in leveraging advanced fraud detection technologies powered by artificial intelligence and global risk intelligence sharing. There’s no silver bullet, but by integrating tools for real-time identity verification, behavioral analytics and device intelligence, operators can flag fraudulent activity before it inflicts damage. What was once a tool to entice legitimate players is now a double-edged sword, cutting deep into operators’ profitability as bonus abuse rises to alarming levels. From fake accounts to stolen identities, fraudsters are exploiting these promotions in ways that demand immediate attention. 45 GPWAtimes.org
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