Multi Accounting: Many users create multiple accounts using fake/stolen IDs to claim sign-up or welcome bonuses – resulting in bonus abuse and collusive play. This makes monetary health of the business go south and results in reputational damage within the players’ community.

Affiliate Fraud: Many platforms offer referral bonuses to the users to invite other players to start playing. Bad actors sign-up to the referral programs, and make conversions using stolen IDs and credentials purchased from the dark web. Further, bots are programmed to automate the process at scale. This sends junk traffic to the platform and deteriorates marketing budgets.

Chargeback Frauds: A common fraud not only in online gaming but across all online businesses. Once a bank detects an illegitimate transaction made by a user using stolen credentials, the business has to endure chargebacks and fines.

Money Laundering: As stakes are involved, bad actors make illegitimate use of platforms to launder illegal gains. Businesses must assess money laundering risks, filter out suspicious accounts, and ensure that transactions happen from verified accounts only.

Underage Playing: Underage gaming is strictly prohibited in real money gaming and can lead to reputational and regulatory risks. Age verification is important to onboard age-appropriate users and prevent minors from getting unlawful access to the platform.

Location Spoofing: Due to the high volume of cross-border traffic, verifying players’ location at scale becomes challenging. As infringing regional restrictions by disguising location is common for bad actors these days, address verification becomes vital to adhere to respective state laws and restrict users from a banned state.

Due to the ubiquity of gaming fraud, including money laundering, the industry has been on the radar of regulators. To prevent fraud and safeguard the interest of the platform as well as players, gaming businesses must comply with anti-fraud regulations like Know Your Customer (KYC) and Anti-Money Laundering (AML). AI-powered KYC verification systems are important here to prevent money laundering, location spoofing, underage playing, and other frauds.