Top five ways device intelligence can help protect and grow your egaming brand

Since the US Supreme Court ruled in 2018 to invalidate the federal law limiting which states can prohibit sports gaming, several states have already jumped into the lucrative, multi-trillion-dollar egaming market. In New Jersey alone, nearly 80% of bets in the first year of legalisation have been placed online or via a mobile app, such as DraftKings Sportsbook or FanDuel Sportsbook.

While this is good news for egaming operators, they will need to keep a close eye on fraud and misuse in an era of hackers, bots, scripts, and spiders. This is not just to prevent financial loss. Knowing the customer will be more important than ever, since regulatory infringements or AML compliance breaches may cost a company millions of dollars and cause long-term erosion of consumer trust, or in the worst-case scenario, complete loss of licence and/or punitive consequences.

As fraud schemes become increasingly more sophisticated, deploying a strong device intelligence solution can help detect fraud and manage compliance, while still maintaining a good customer experience for valid players.

Common types of fraud

Typical fraud issues facing the egaming industry include:

Account takeovers: Hackers target legitimate players and loyal customers to gain access to their online gaming accounts by leveraging data from other breaches. Since many players use the same passwords across multiple sites, hackers are able to apply it and successfully take over someone’s online gaming accounts.

Chargebacks: These can be legitimate cases of stolen credit card fraud or “friendly fraud” in which the buyer forgets they made a charge or simply has buyer’s remorse and wishes they hadn’t. Often, this happens when people lose more money than they have and claim they did not make the charge.

Collusion: This is fraud perpetrated by a group, in which several people join together to play poker, for example, and are all in on the scheme. They arrange for one person to continually win during a promotion time, such as when winnings are tripled, and then reap the rewards.

Bots: These are operated by algorithms to play 24/7 over and over and can run up massive victories for the fraudsters at high financial cost to egaming companies.

Top five ways to prevent egaming fraud

A robust device intelligence system is imperative for egaming companies to truly know their customers and identify the warning signs of fraud before it’s too late.

1 – Identify the user’s true location – based on precise latitude and longitude: This can reveal invalid coordinates, out of bounds coordinates, plus WiFi, cell tower, and IP addresses that don’t reflect standard consumer use. This would include piercing down to the player’s location and detecting if they are using a proxy or VPN to mask their true location.

2 – Know exactly what type of device – browser, mobile, or tablet: Operators need to know how their customers are interacting with the gaming platform, plus specific settings such as language to determine their validity.

3 – Detect the true IP: Identify when people are trying to commit fraud through the same address or multiple IPs that are not legitimate.

4 – Flag a jailbroken mobile device: Confirm if a mobile phone has been stripped of factory protections, enabling devices to bypass many common fraud screenings.

5 – Determine velocity: how many accounts one device has accessed: A velocity check will look out for repeating patterns and monitor the number of times a device has accessed an account or several accounts within a specific timeframe to determine if it’s likely being used for fraudulent activities.

A matter of trust

With fraud levels subject to increase, egaming operators should consider incorporating a comprehensive device intelligence system or fraud detection solution into their business operations.

As more and more players join the egaming community, customers are looking to play with brands they can trust. That’s why companies that effectively balance growth and protection while deterring fraud will be more likely to hit the jackpot in this growing market.

Dave Champion is global head of online gaming, Accertify Inc. (an American Express Company) and co-founder and Exco Member of the Australian Online Fraud Forum. After graduating from University in South Africa Champion moved to London to join the investment banking sector, quickly learning the ropes and working his way up from internal client service to helping organisations transform their operations at a time of major change for the industry. After 10 years abroad he returned to his native South Africa, taking a role with the world’s leading provider of online gaming solutions, Microgaming.  In 2012 he and his family moved to Sydney, Australia taking up an opportunity that lead to heading up Sales at Accertify helping merchants to fight online fraud.