In the last few years, the gaming industry, which includes real money games, casual games and esports, has grown exponentially to become a multi-billion dollar industry. The rise in digital infrastructure accelerated the online gaming market’s growth with cheap and fast internet connections throughout the country. A study pegs the size of the online gaming industry in India to surpass 2.2 billion in 2022.
With the number of gamers exponentially increasing yearly, the gaming industry has become susceptible to fraud. Gaming platforms are becoming increasingly attractive to fraudsters as they permit a cloak of anonymity and lack the relevant regulatory requirements and compliance checks.
Cases of money laundering, fraudulent deposits, chargebacks and cheating have been rampant in recent years. With a lack of standardised online identity verification and authentication tools to prevent fraud, gaming companies worldwide are fighting a tough battle against fraud to retain customer loyalty, maintain the game’s sanctity and provide a good gaming experience.
Types of Gaming fraud
Players register using fake ID documents. Minors masquerade as legal users by providing fake details.
A single user creates two or more fake accounts and player profiles to compete against themselves in online poker tournaments, thereby controlling the entire game.
Players create multiple fake identities or real stolen identities to benefit multiple times from gaming promotions and giveaways beyond the limits set per legitimate user.
Players exploit the system through gaming bots to artificially accelerate game progress or mine currency.
Risk of loss of funds by good users due to bad actors illegally gaining access to their accounts.
How does a fraudster monetise gaming fraud?
1. Fraudsters turn stolen virtual goods into real cash, they buy and sell the virtual currency, which provides opportunities for money laundering and payment fraud.
2. The fraudsters try to launder the items and sell them for real money in the real world via trading sites.
3. Loyal customers spend hundreds of hours and dollars on gaming content, their accounts hold tons of value, get subjected to gaming fraud, and are at high risk of account takeover by the ill users of the gaming fraud industry.
Consequences of fraud
Fraudulent attacks not only affect long-term success and revenue but also cause damage to the platform’s reputation. Bad user experiences and feedback can significantly stop new players from logging in, hurting your revenue.
With a call for stricter regulations and penalties for the gaming industry, the day is not far when government agencies will examine e-sports and gaming companies. Therefore, protecting your company from fraudsters will be one of your most logical investments for the future.
Game over for fraudsters
Knowing your good players and blocking or challenging the not-so-good ones is key to preventing gaming fraud. An AI-driven fraud prevention solution can access if a new gaming account, promo, or payment indicates fraud. A solution that establishes identity trust for every interaction will allow game companies to block new account fraud, reduce promo abuse and prevent chargebacks. Each type of fraud is as unique as the game on your platform in many aspects. Fortunately, solutions with custom ML models can be created and trained to detect potentially fraudulent activity and flag it for review.
Custom workflows on Bureau’s platform can accurately and seamlessly verify identities, reduce risk and stop fraud while promoting compliance and growth. A single API or service intelligently combines insights from hundreds of data sources, including device, identity, email, biometrics and more, to accurately detect fraud.
Case in point: a single player controlling multiplayer accounts during poker matches to ensure outsized wins. With Bureau’s stringent checks involving Behavioural biometrics, device and phone intelligence, the legitimacy of fake IDs or stolen credentials used to create additional player accounts can be tested, thereby blocking or deterring single players with multiple accounts.
Bureau’s device intelligence and behavioural biometrics detect real-time location-based information, including uncovering real-time IPs despite spoofed location information to check on the location of all four players in a match. Device intelligence can also detect account takeovers by collecting and analysing device data associated with specific users.
Behavioural biometrics (how the player types, swipes, moves, and positions the device) unique to a player is also used to detect users controlling multiple accounts. As a result, game companies can better identify legitimate players and reduce friction for known players. If somebody has successfully been able to phish account information from a user and then tries to log in, they can be blocked.
With Bureau’s workflow, game companies can automate decisions to approve or decline transactions in real-time so gamers can expect immediate transactions.
Read more on Risk Based Authentication
With fraudsters becoming craftier, understanding and predicting player behaviour isn't enough. Gaming platforms must have an automated system to identify fraudulent activities that will use the data to automate escalation and take action against suspicious behaviour by linking the dots in real-time. Talk to us if you want to prevent gaming fraud from affecting your business.