Unmasking Online Casino Scams: How to Protect Yourself and Your Wallet

What Is Online Casino Fraud?

Scammers have been focusing on casinos and other gambling institutions for decades. The majority of people understand how sleight of hand and trickery can change the outcome of a game. The same theory that underlies these kinds of methods has promoted theft in the online gambling world.

Online gambling fraud is any case in which a rogue actor abuses or misuses an internet gambling site for their own benefit. The laws governing online gambling were created to make games equal, but these rules can be bent or broken by scammers who want to boost their winnings.

Why do gambling platforms have an elevated risk of fraud?

Online fraudsters typically have a small likelihood of success. People are becoming increasingly cautious about becoming victims of scams, and businesses are taking steps to defend themselves from all sorts of online payment fraud.

However, when Online casino scammers do win, the returns are huge. IBM discovered that the typical company cost of a cyberattack in 2020 was almost $4 million.

Gambling platforms are at a huge risk of being attacked nowadays because of their rising popularity since the 2020 pandemic. When more people gather around a specific trend, that means more possible prey for fraudsters to target. If a gambling site’s popularity rises from having 1 million annual visitors to 2 million, that means an extra million people could be deceived.

Gaming websites may also have a huge transaction volume, with players making frequent payments. This may make it more difficult to identify card testing or even catch individual fake buys.

How does fraud affect online gambling?

With online gambling scams growing, the risk to gambling websites is greater than simply losing money. Customers are more likely to choose sites they feel safe on, so they will avoid those they think can be easily hacked.

47% of consumers mentioned in one survey that if they come across any problems in the payment procedure, they’ll quit a brand and go elsewhere. Despite the lack of successful fraudulent trials, that brand is very easily damaged in the minds of the people that scammers have targeted.

Victimized customers can easily become an issue for companies too. Credit card holders can have the stolen funds back as a chargeback, which comes directly from the bank account of the business that processed the scam.

You may not be able to do much about it, either. Your customers may lose money to scammers in the beginning, but it comes from your wallet.

What Are the Most Common Types of Online Gambling Fraud?

As already established, online gambling fraud can take various forms. It’s vital to be aware of the most prevalent forms of gambling fraud and remain abreast of any latest developments. You can learn how to protect yourself when you are aware of your vulnerability to scammers.

Here are a few of the common types of online casino scams:

1.  Multiple Account Fraud

Multiple account fraud (also known as multi-accounting) is the most prevalent form of online gambling fraud. Having a few accounts included in one game presents a range of opportunities that fraudsters can profit from, but usually the primary losers in this situation are your other players.

Using multiple devices and hiding their IP addresses by using a VPN are the two most popular ways fraudsters get around this.

2.  Gnoming

Gnoming is when a fraudster creates more than one account with a single online gambling site and utilizes them to circumvent standard regulations.

Online gambling frequently comes with constraints on maximum wagers, but scammers can get around these limits when they have many accounts.

This is important given the last example about one fraudster manipulating multiple poker hands. The ability to exceed maximum bet limits allows the cheater to place large bets on hands they are confident will win.

3.  Bonus Abuse

In this circumstance, the gambling platform will reimburse fraud out of its wallet. One of the simpler online gambling frauds preys on online casinos’ promotions for brand-new account holders.

Bonuses can consist of free money for your first bet, coupons, or discounts. These deals aid gambling sites in luring new customers, and in a competitive environment, they may assist you in distinguishing yourself from your rivals. However, they also contain some risk.

Fraudsters can create several accounts from various email addresses, devices, or IP addresses. These bonuses may not be very valuable, but they represent free money for the con artist and money that you have just given away.

4.  Credit Card Fraud

Online gambling sites can be an excellent place to spend the money on a stolen credit card if scammers obtain it. It can be as easy as creating an account, putting money in it, and cashing it out instantly.

Other credit card frauds typically take a while to make money – they need to buy something from stolen credit cards and sell what they have stolen. In this case, even if they play a few rounds of poker and lose, they will still have significantly more money than they started with.

Gambling websites are actually at risk because stolen credit card credentials are frequently traded on the dark web.

5.  Chargeback Fraud

When customers manipulate a form of insurance on their credit card that (ironically) safeguards them from scams, it is known as chargeback fraud.

A chargeback gambling transaction can be set up by a customer when they’ve suffered significant losses. They can reach their bank or credit card issuer and complain that their card was stolen or used without their consent.

Even if the online gambling website disputes the circumstances, the bank may then choose to reimburse their losses directly from the website’s bank account.

In this case, it helps the gambling site’s case if it can reveal that it takes steps to prevent stolen credit cards from being used.

How to prevent gambling fraud

A safe, fair, and enjoyable gaming environment must include measures to prevent casino fraud.

• In-person casinos use security cameras and even facial recognition technology to keep an eye on all gameplay and to watch for known fraudsters. Casinos also define procedures such as when to shuffle, when to switch to a new deck, how to deal, etc. Additionally, casinos will include people they believe are cheating to a list of expelled people, preventing repeat offenders.

• When taking on new members, online casinos must be careful. ID checks to confirm age and home state, device intelligence, and spoof-resistant location intelligence are merely simple ways to identify the risk level that a new player has malicious intent. Preventing online gambling fraud protects both the customer experience and the company’s ability to make a profit.

• Additionally, apps should keep a watchful eye on red flags like spending excessive amounts soon after setting up an account, accounts that drastically vary from their usual behavior, evidence of location spoofing, and numerous accounts signing on from the same device or location. 

• Players can safeguard themselves and their accounts by keeping an eye out for questionable transactions in their credit card activity, using multi-factor authentication on their gaming apps, and reporting any alleged player collusion to the relevant app or website.

• Gambling always carries some risk, but when fraudsters stack the deck, players, and casinos accept risks that they didn’t authorize. The gaming industry can maintain the same level of player experience as always by utilizing spoof-resistant location identity and adhering to other fraud prevention best practices.