ID Verification – Fraud Prevention in Online Gambling Industry

ID Verification – Fraud Prevention in Online Gambling Industry

Learn more

By its very nature, gambling is quite risky. Add to it the potential for fraud that it attracts, and any platform can become unsafe for players. Online businesses and interactive platforms are particularly vulnerable when it comes to online frauds and scams. Cybercriminals have found more sophisticated and advanced ways to trick online users and commit crimes like identity and credit card fraud. Online gambling platforms are no exception to frauds and are in need of reliable anti-fraud solutions to protect their businesses. Automated systems for ID verification can prove to be a useful solution for protecting the gambling industry from fraud.

The online gaming industry has seen tremendous growth over the years and shows no signs of slowing down. The overall trade is expected to hit the figure of $1 trillion by the year 2021. With such a large trade volume, there lies a huge opportunity for online fraudsters to use such platforms to their advantage. There are a number of different kinds of frauds that plague the online gambling sector, the most common of which are;

Some Common Online Gambling Frauds

  • Multiple Accounts – An online fraudster tends to create a number of different accounts to use on the gambling website. All such accounts are made using fake credentials. These multiple accounts are then used for different schemes. The idea is to make one particular account win while making the others lose deliberately. The fraudster can then reap benefits from the account that wins.
  • Credit Card Fraud – Credit card fraud is common across all online businesses and retailers. The perpetrator tends to use fraudulent or stolen credentials to pay for their bets to charge up their accounts. Once the bank or credit card company finds out about the fraudulent transaction the business faces chargebacks and fines.
  • Money Laundering – Online gambling platforms also have to ensure that their services are not being used to launder dirty or ill-gotten money by criminals. Since gambling businesses deal with large sums of money, it makes it easier for money launderers to use the platform to hide illegal funds.


In addition to fighting fraud, online gambling websites have to prevent underage usage. There are strict laws in place that prevent underage gambling. Adhering to these laws, gambling businesses have to practice measures to verify the age of their users. While it may be easier for traditional casinos to point out underage gamblers, online platforms have no way of knowing if the user is underage or not. Therefore, there needs to be an effective method for age verification of users through online ID verification and facial recognition.

Combating Fraud with ID Verification

Online businesses and gambling companies have had to face hefty fines for not having adequate measures in place for user verifications. The Gambling Commission in the UK charged an online gambling company $10 million in fines for not having a sound KYC process. For businesses looking to fight fraudulent activities, they generally tend to implement a Know Your Customer or KYC structure. Governments and regulatory authorities across the globe have also issued requirements for businesses to implement KYC procedures to authenticate each and every client or customer. Such procedures also help in fulfilling age verification requirements for online gambling companies.

Read More: Secure Online Gambling through Identity and Age Verification

A sound KYC system also allows businesses to prevent chargebacks and fines that are a result of credit card fraud and identity theft scams. Having an online identity verification system in place can enable gambling businesses to develop a better KYC system for their businesses. ID verification services can be availed in a number of ways;

KYC verification systems are now available that leverage modern technologies like artificial intelligence and machine learning to provide KYC services to businesses. Shufti Pro is a leading ID verification software that caters to businesses from a number of different industries. The online gambling industry too can avail their ID verification service which is extremely easy to integrate for any business having a web-based interface.

Shufti Pro provides real-time verifications through document verifications, facial recognition online and AML screening checks. It is designed on a combination of Artificial Intelligence (AI) and Human Intelligence (HI). Shufti Pro has universal language support and can verify users from more than 230 countries.

The online gambling sector can reap numerous benefits from an automated ID verification system. They can use a system like Shufti Pro to reduce frauds in their business. It also enables them to lessen the number of chargebacks and fines, ultimately increasing their profits. To eliminate underage gambling the system can verify a users age through document and face verification features. Most importantly, they can eliminate the threat of money laundering activities through AML screening checks. This can increase the levels of trust among their customers and help them run clean practices.