Online Casino Bonus Abuse

Any time there is an enterprise of any kind that involves money, there is also the potential for theft or fraud. Online casinos have potentially billions of dollars flowing through them and therefore are also susceptible to various types of fraud or theft. Since online casinos exist only in the virtual world and deal only in digital currency and not a hard currency, they are not as susceptible to being robbed as regular casinos. They are, however, susceptible to different types of fraud. One of these types of fraud is called bonus abuse. Here is an overview of online gambling bonus abuse; what it is, how it occurs and what can be done to stop it.

What is Online Casino Bonus Abuse Gambling?

Like almost any business or company, online casinos use promotional offers to attract new customers, keep current customers or lure back old customers that haven't been around in a while. While these promotional offers can take many forms, one of the most common ones is to offer a percentage of a deposit as a bonus. So, for instance, if a person made an initial deposit of $500 with a 10% signup bonus, then they would receive $550 in playable funds. Most bonuses come with rollover requirements, which means the player has to put the full bonus amount in play a certain number of times before they can withdraw the money. For instance, a 3X rollover requirement means they would have to put the full $50 in play at least 3 times before they can withdraw the money. In online gambling bonus abuse, players find ways of cheating the system in order to walk away with more bonuses than they are entitled to.

How Does Online Casino Bonus Abuse Work?

There are essentially two key elements of online gambling bonus abuse. The first is the number of times a single player is eligible for a bonus and the second is finding a way to beat the rollover requirements. There are actually two types of online casinos: registered and unregistered. Registered casinos are highly regulated and as a result, are required to obtain some type of government-issued identification before opening an account or allowing funds to be withdrawn. This cuts down somewhat on bonus abuse because it limits the number of accounts a single individual can open. While they can still abuse the system by providing fake or stolen identification, those are still somewhat hard to come by, which means they can only abuse the system so many times.

Unregistered casinos, however, are not monitored as carefully and in some cases, governments may even be unaware of their existence. This also makes them more susceptible to bonus abuse, particularly when cryptocurrency is involved. When funds are transferred via a credit card, bank account or digital wallet that deals in hard currency, casinos can also monitor the number of times funds attached to a certain person are used. Cryptocurrency transfers are anonymous, however, which means casinos can't track how many times an individual makes an initial deposit from the same account. Every time a cryptocurrency wallet is used, it generates a new code. So, the same person can use the same cryptocurrency wallet to make opening deposits several times over and no one will be the wiser. Using cryptocurrency, all an individual needs to do is set up several free email accounts and then set up several new casino accounts using a cryptocurrency wallet to make an opening deposit. The same person can then benefit from an opening deposit bonus again and again.

Online Casino Bonus Abuse and Rollover Bonus Requirements

Almost all casino bonuses come with rollover requirements. Needless to say, casinos want players to gamble, which is how casinos make their money. Bonuses are only paid out if a player gives the casino a certain number of opportunities to actually win the money back, as well as a chunk of the player's initial stake. Therefore, casinos institute rollover requirements that mean players have to bet a certain amount of money a certain number of times before they can request a payout of the bonus. There are a few ways in which players can either bypass or rig these bonus requirements. One is to simply play games that have the lowest risk but the biggest payouts and then cash out as soon as the requirements have been met. Another way is through player collusion.

Player collusion can occur in several ways, but one of the most common is chip dumping. Chip dumping is a practice that generally takes place in online poker games. It occurs when one person purposefully loses to another or "dumps" all of their chips on them. For instance, say two players sign up and get an opening deposit bonus of 10%. If they make an opening deposit of $1,000, then they each get a $100 bonus. If they both participate in an online poker game, then they can simply lose to each other until the rollover requirements have been met. Once the rollover requirements have been met, they can both cash out, pocket their bonus, create a new account and start all over again.

Online Casino Bonus Abuse Detection & Prevention

Unregistered casinos benefit from their ability to offer anonymous play, but it also opens them up more to bonus abuse. When players have to prove their identity before making a withdrawal, it limits their ability to open multiple accounts. Some bonus abuse can be prevented by using beacons that can track a player's location or the IP address of a specific device, but even those protections can be thwarted. Players can spoof their locations and use multiple devices for gameplay, which keeps casinos from being able to track which players are opening multiple accounts. Even when players don't open multiple accounts with the same casino, however, there are an estimated 2,200 online casinos available. This allows players to take advantage of a host of bonuses without technically committing bonus fraud.

iovation is a leading provider of fraud prevention and detection solutions as well as advanced MFA software for online banking, e-commerce, insurance, gambling, online communities, and travel and ticketing organizations.

Ready for the next step?

In just minutes, we’ll show you how to improve your customer authentication experience, stop fraud and save money.

Fraud Prevention

Spot user behaviors and device information that’s suspicious, and stop those fraudsters in real time. We track billions of devices and our fraud analysts add evidence to make this intelligence even more effective.

Stop Online Fraud

Ready for the next step?

In just minutes, we’ll show you how to improve your customer authentication experience, stop fraud and save money.