Online Gambling Fraud: Insightful Prevention Measures

December 6, 2021
December 6, 2021
Online gambling fraud prevention

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Online gambling was more popular than ever in 2020. Pandemic lockdowns drove people towards at-home activities, and gambling sites were one of many beneficiaries.

However, as things become more popular with punters (or players), they also attract the attention of scammers. A general increase in internet usage has spurred dramatic growth in the value of all types of cybercrime - up 300 percent.

multi-billion dollar industry is driving more business owners to protect themselves with online fraud prevention.

Protecting your business and customers from the effects of online gambling fraud is more important than ever for gambling websites.

What is Online Gambling Fraud?

Online gambling fraud is any instance where a rogue actor manipulates or exploits an internet gambling site for their gain. The rules around online gambling are designed to make games fair, but they can be bent or broken by fraudsters looking to increase their winnings.

Fraudsters have been targeting casinos and other gambling institutions for years. Most people understand how sleight of hand and trickery can tip the odds of a game. The same principle that is behind these kinds of techniques has inspired fraud in the online gambling world.

Fraudsters utilize a range of scenarios to come out ahead, which are discussed below. The victims can be either the house/gambling site or its punters.

Why do gambling platforms have an increased risk of fraud?

Online fraudsters generally have a low chance of success. People are becoming increasingly wary of scams, and businesses are taking steps to protect themselves from all types of online payment fraud.

However, when fraudsters do succeed, the returns are lucrative. IBM found the average business cost of a cyber attack in 2020 was nearly $4 million.

Gambling platforms are more likely to be targeted recently due to their burgeoning popularity since the 2020 pandemic. More people flock to a particular trend, which means more potential victims for fraudsters to target. If a gambling site goes from 1 million annual visitors to 2 million, an extra million people could be ripped off.

Gaming websites are also likely to have high transaction volume, with players making many payments regularly. This may make detecting card testing more challenging or even catching individual fraudulent purchases.

How Does Fraud Affect Online Gambling?

With online gambling scams on the rise, the risk to gambling websites is more than just losing money. Customers are more likely to prefer sites they feel safe on, which means they will avoid those they believe can be easily exploited.

In one survey, 47% of consumers said that if they encounter any issues in the payment process, they’ll abandon a brand and go elsewhere. Even if there are no successful fraud attempts, that brand becomes tarnished in the minds of people whom fraudsters have targeted.

Defrauded customers can quickly become a problem for companies, too. Credit card holders can get defrauded money returned as a chargeback directly from the business’s bank account that processed the scam.

There may be little you can do about this. Your customers may initially lose money to scammers, but it comes out of your pocket.

What Are the Most Common Types of Online Gambling Fraud?

As mentioned, online gambling fraud can take a few different forms. It’s essential to be aware of the most common methods of gambling fraud and stay on top of new or emerging trends. When you know how scammers will likely target you, you can learn how to protect yourself.\

The most common techniques are multiple account fraud, credit card fraud, and chargeback abuse.

Multiple Account Fraud

Multiple account fraud (or multi-accounting) is the most common type of online gambling fraud. Having more than one account involved in one game presents various opportunities that scammers can take advantage of. Still, typically, the immediate losers in this scenario are your other players.

For example, in a poker game, if a fraudster controls six hands and only two other people are playing, there is a greater chance that one of the fraudster’s hands will win.

The two most common ways fraudsters get around this is by using multiple devices and utilizing different IP addresses via a VPN to avoid being detected.

Gnoming, bonus abuse, and chip dumping are all forms of multiple account fraud, but we will go into each case in more detail below.


Gnoming is where a fraudster creates multiple accounts with one online gambling site and then uses the accounts to get around standard rules.

Online gambling often has maximum bet limitations, but fraudsters can get around these limits with multiple accounts.

This is significant considering the previous example about one fraudster controlling numerous poker hands. Being able to go over maximum bet allowances means the fraudster can bet big on a hand they know they have a good chance of winning.

Chip Dumping

Chip dumping is similar to gnoming and is a common form of online poker fraud. When fraudsters control multiple accounts at one poker table, they can drive up the betting for legitimate players, knowing they have more chance of winning the hand.

In a legitimate game, money lost a game goes to another player. But when fraudsters have multiple players, losing a hand to a player they also control is essentially the same as a bank transfer.

For example, the fraudster can bet hard on one hand that doesn’t have great cards to encourage legitimate players to bet big, too. They can also follow with a hand with good cards, but other players perceive them differently because that player isn’t upping the ante.

Manipulating games this way can significantly impact other players’ chances of winning. It is an integral part of gambling that everyone has a fair chance to win based on the game’s odds; the above multi-accounting tricks make it less likely that your honest players will have an enjoyable experience.

Bonus Abuse

In this scenario, the gambling platform will pay out of pocket for fraud. One of the more basic online gambling scams, bonus abuse takes advantage of online casinos, making offers to new account holders.

Bonuses can include free money for your first bet, coupons, or discounts. These deals help gambling sites attract new customers, and in a competitive environment, they can help you stand out from your competitors. However, they’re not without risk.

Fraudsters can set up multiple accounts from different email addresses, devices, or IP addresses. These bonuses may not be worth a lot, but it’s free money to the fraudster and money you’ve just given away for nothing.

Credit Card Fraud

For fraudsters who get their hands on a stolen credit card, online gambling sites can be a great place to drain the funds on that card. It can be as simple as opening an account, depositing the funds, and cashing out immediately.

Other credit card frauds generally have some downtime to make money - they need to make purchases from stolen credit cards and on-sell the items they’ve bought. In this instance, even if they play a few hands of poker and lose, they still walk away with much more money than they had initially.

Stolen credit card credentials are commonly bought and sold on the dark web, which is a genuine risk for gambling websites.

Chargeback Fraud

Chargeback fraud is where customers exploit a form of insurance on their credit card that (ironically) protects them from fraud.

A chargeback gambling transaction can be initiated by a customer when they’ve lost a lot of money. They can call their bank or credit card issuer and claim their card was stolen or used without permission. The bank can then reimburse their losses directly from the bank account of the online gambling website, even if the website challenges the circumstances.

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

How Can Merchants Prevent Online Gambling Fraud?

The nature of online gambling means it will always be attractive to fraudsters. However, you can do things to minimize online gambling risks, and they can make a significant difference.

A general theme that helps to prevent online gambling fraud is knowing exactly who your customers are. When you do, customers can’t create multiple profiles, and they can’t use credit cards that aren’t their own. You can also dispute chargeback fraud attempts.

There is a range of techniques you can use to identify customers correctly:

  • Encourage strong passwords and two-factor authentication. This makes it much harder for fraudsters to access other people’s accounts.
  • Use identity verification services that identify user data such as IP address, email, and geolocation.
  • Implement fraud prevention software that can conduct risk assessments based on the browser behavior of users and raise red flags over users who display suspicious activity.

A leading tool in online fraud prevention is browser fingerprinting. You can generate a digital fingerprint for every visitor to your web app, which tracks their browsing activity and behavior over time. Browser fingerprints persist even if a visitor uses a VPN or goes into private browsing mode, allowing sites to catch fraudsters trying to conceal their identity.

One beneficial application for browser fingerprinting for gambling sites is to prevent multi-accounting. Fingerprints verify users as they log in to their accounts, making sure people only use one profile at once. You can also block fraudsters whose fingerprints have been previously associated with fraudulent activity on your site from ever logging in again.


Taking steps to prevent online gambling fraud is a must. It’s virtually inevitable that fraudsters will attempt to defraud your online gambling business at some point, which can be hugely damaging if those attempts are successful.

Online gambling sites need industry-leading fraud prevention, and Fingerprint can help.

Fingerprint uses the very latest in fingerprinting technology to identify suspicious users that pose a security threat with 99.5 percent accuracy. The technology is easy to implement and requires no maintenance, giving you peace of mind with minimal effort.

Fingerprint has helped identify billions of internet users, creating a world-leading database that protects businesses of all shapes and sizes from the ever-growing threat of cybercrime.

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