How to Detect and Prevent Online Gaming Fraud
Published: March 21, 2025
To effectively detect and prevent online gaming fraud, you need to implement robust security measures and stay informed about the latest fraud techniques. Taking steps to ensure user safety and security is crucial to maintaining a healthy gaming environment and decreasing potential financial and reputational risks to your business. This guide offers suggestions and resources for fraud prevention and detection, which may impact the ongoing operability of your online gaming platform.
Gather Data on Your Existing Customer Base
This foundational step informs all subsequent prevention strategies. Understanding the different types of fraud allows you to tailor your defenses effectively. Extensive data collection and subsequent risk score calculation for each user may facilitate the proactive identification and mitigation of potential threats. Gathering information on users’ IP addresses, device data, payment data, and other datasets is a basic strategy.
Identify Common Fraud Types: Familiarize yourself with these common online gaming fraud types:
|
Type of Fraud |
Description |
Impact |
Example |
|---|---|---|---|
|
Multiple Account Fraud (Multi-Accounting) |
Fraudsters use multiple accounts to gain an unfair advantage, often using emulators, virtual machines, and residential-like IPs. |
Unfair gameplay, skewed results, exclusion of legitimate players. |
Chip dumping in poker, manipulating leaderboards. |
|
Credit Card Fraud (“True Fraud”) |
Stolen credit card details are used to make unauthorized purchases, create new accounts, and build account value for resale. |
Financial losses due to chargebacks, damage to reputation. |
Purchasing in-game items and skins with stolen cards. |
|
Chargeback Fraud (Friendly Fraud) |
Customers dispute legitimate charges with their bank, leading to financial losses for the business. |
Financial losses, administrative burden of disputing chargebacks. |
Claiming an unauthorized purchase despite making it. |
|
Account Takeovers |
Fraudsters gain access to existing accounts using stolen credentials or automation software (e.g., credential stuffing). |
Loss of in-game items, compromised personal information, reputational damage. |
Selling stolen in-game currency or accounts. |
|
Bonus Abuse |
Fraudsters create multiple accounts to exploit special offers and bonuses. |
Financial losses due to bonus payouts, wasted marketing budget. |
Exploiting referral programs or in-game promotions. |
|
Affiliate Fraud |
Third-party affiliates engage in deceitful actions to derive personal benefit from marketing campaigns. |
Wasted marketing spend, inaccurate performance metrics. |
Generating fake leads or inflating click-through rates. |
Risk Assessment: Conduct a self-assessment to determine your platform’s vulnerability:
|
Question |
Low Risk |
Medium Risk |
High Risk |
|---|---|---|---|
|
Target Audience |
Niche, small player base |
Growing player base, some competitive elements |
Large, active player base, significant financial transactions |
|
Transaction Volume |
Low volume of transactions |
Moderate volume, increasing transactions |
High volume, frequent transactions, large sums |
|
Security Measures |
Basic security in place |
Moderate security, some proactive measures |
Limited security, reactive approach |
|
Fraud History |
No history of fraud |
Occasional fraud incidents |
Frequent fraud attempts and successful attacks |
Use this assessment to manage your fraud prevention strategy. Individuals with a high-risk profile require a more thorough approach.
Data Collection & Analysis:
- Basic Data: Collect user IP addresses, device data (device fingerprinting), payment data, and geolocation.
- Advanced Data: Analyze site referral activity, implement password management provisions, ensure access control management (security questions, geo-location verification), and control deposit sizes
- Assign risk scores to users based on collected data and behavioral patterns. This will direct resources toward individuals with greater potential risk.
Online Gaming Fraud Prevention Checklist
Protect your SaaS gaming platform from costly attacks.
-
Actionable steps to identify vulnerabilities
-
Key security measures to implement
-
Best practices for data protection
-
Risk assessment guidance
-
and more!
Implement User Authentication
Keeping fraud as far away as possible from your game starts with separating good users from fraudsters.
To do that, you need to have protocols in place to make sure gamers are who they say they are:
- Add Captcha: Used as a verification mechanism to separate human users from bots, a CAPTCHA is a test that users need to complete when creating a new account.
- Use Multi-Factor Authentication: These security protocols require the user to provide additional pieces of information to verify their identity. Two factor authentication links, codes sent to phone numbers, fingerprinting, or facial recognition are some options worth considering.
- Consider Document Verification: It is very important to make sure that when requiring the users to upload documents to confirm identity, your software can liveness.
- Verify User Data: Identity verification services look at a user’s IP address, geolocation, email address, and other data
Online Gaming Fraud Prevention Checklist
Protect your SaaS gaming platform from costly attacks.
-
Actionable steps to identify vulnerabilities
-
Key security measures to implement
-
Best practices for data protection
-
Risk assessment guidance
-
and more!
Gather Data on Your Existing Customer Base
First, you need to ensure that your users are safe when enjoying your platform. Ensuring the security and integrity of user data is essential for maintaining the reputation and functionality of your platform. Here are some steps you can take to add the necessary layers of security:
- Add Firewalls: These mechanisms oversee your website’s traffic and filter out bad traffic, which also includes bots.
- Security enhancement: Implement Secure Sockets Layer (SSL) encryption to protect sensitive information such as credit card numbers and login credentials.
- Security Patches: Regularly patching software vulnerabilities can reduce the likelihood of security breaches.Updating software regularly can resolve existing problems and potentially reduce the likelihood of unauthorized access.
- Perform Security Audits: Stay ahead of fraudsters and scammers by conducting regular audits on your security framework. Identifying potential vulnerabilities before criminals exploit them is crucial for proactive security measures.
- E-Invoicing: Using secure emails, private networks, or protocols like AS2, FTPS, web services, and VANs to ensure customer data protection during e-invoicing.
- Data and Security: The relationship between data and security is crucial, with more data facilitating the development of effective fraud detection and prevention strategies. Maintaining updated security, payments, and identity information is crucial for mitigating the risks of fraud. Always use AI and ML technologies for their huge data harvesting capacity.
Online Gaming Fraud Prevention Checklist
Protect your SaaS gaming platform from costly attacks.
-
Actionable steps to identify vulnerabilities
-
Key security measures to implement
-
Best practices for data protection
-
Risk assessment guidance
-
and more!
Verify Payment Information
During the checkout phase, it’s very important to add certain steps to ensure that the cardholders are, in fact, the ones making the purchase:
Request CVV Codes: Because CVV cannot be stored, fraudsters cannot obtain them from data breaches. Due to this, they will be unable to supply them.
Implement AVS checks: The Address Verification Systems are a common method to check the validity of an order by comparing the billing address used in the transaction with the cardholder’s information from the issuing bank. These verifications play a role in minimizing unauthorized payments and serve as evidence in chargeback disputes.
3D Secure: Use 3D Secure authentication (e.g., Verified by Visa, Mastercard SecureCode) for an extra layer of security.
Payment Solution Security: Ensure your payment solution is PCI-DSS compliant.
Online Gaming Fraud Prevention Checklist
Protect your SaaS gaming platform from costly attacks.
-
Actionable steps to identify vulnerabilities
-
Key security measures to implement
-
Best practices for data protection
-
Risk assessment guidance
-
and more!
Utilize Data Enrichment Processes
Another way to enhance security is through data enrichment processes ‒ which means you are tracking beyond just a user’s identity information.
You can monitor device fingerprints and email profiles and conduct phone and IP analyses. Legitimate users would usually use an email address that is older and linked to other apps or social media. The system may identify unlinked email addresses as potentially linked to fraudulent purposes and flag them accordingly. It is recommended to investigate desktops that utilize cellular data extensively but lack call history. Utilizing the information provided may assist in deterring unauthorized access to your platform.
So to monitor user behavior, use:
Device Fingerprinting: to identify devices associated with fraudulent activity.
Behavioral Analysis (login patterns, in-game activity) for suspicious anomalies.
IP addresses Analysis for suspicious activity (proxy use, location inconsistencies).
Online Gaming Fraud Prevention Checklist
Protect your SaaS gaming platform from costly attacks.
-
Actionable steps to identify vulnerabilities
-
Key security measures to implement
-
Best practices for data protection
-
Risk assessment guidance
-
and more!
Collaborate with a Reliable eCommerce Provider
A good eCommerce partner is essential. Integrated e-commerce solutions may affect both fraud protection and platform growth in various ways, some positive and some requiring careful management.
Here are a few aspects you should consider:
You must ensure that your payment solution is PCI DSS certified. The Payment Card Industry Data Security Standard (PCI-DSS) is a set of security standards designed to ensure that all merchants accept, process, store, and transmit credit card information in a regulated way that minimizes the risk of payment fraud, data breaches, and data theft.
Your partner needs to be able to conduct risk assessments based on users’ browser activity and then flag suspicious users and activity. Check that your provider offers expertise working with large organizations, loyalty fraud management, policy abuse protection, automated decisions, and the manual review of suspicious flagged transactions.
Fraud Management Tools: Your partner needs to have experience, expertise, and, most importantly, the required technology to fight fraud effectively. Considering the ever-changing nature of this challenge, the technology involved in both preventing and detecting cyber attacks needs to keep up with market transformations.
Your business needs to benefit from support on all gaming-specific payment strategies like MTX, as well as dispute management and dedicated customer support.
Support: Ensure 24/7 customer billing support and dedicated fraud management teams.
PayPro Global offers tools to facilitate game developers’ international expansion through their eCommerce system:
- Implement a consolidated communication tool for global sales, minimizing reliance on external integrations.
- Compliance management for global video game taxes. The dedicated team of experts tracks regulatory changes, ensuring compliance.
- Customized checkout pages, subscription management, and billing.
- 100+ Payment Methods, 110+ Currencies,
- AI-powered fraud prevention and detection platform that employs various technologies to identify and mitigate the risk of gaming fraud.
- 24/7 customer support and its potential impact on reducing chargebacks and fraud, along with features like automated licensing and invoicing.
Online Gaming Fraud Prevention Checklist
Protect your SaaS gaming platform from costly attacks.
-
Actionable steps to identify vulnerabilities
-
Key security measures to implement
-
Best practices for data protection
-
Risk assessment guidance
-
and more!
Monitor Regularly for Suspicious Activity
Regular site monitoring can help businesses protect themselves from potentially suspicious activity that can snowball into quantifiable fraud in the future.
Collecting as much information as possible to train and refine the fraud detection algorithms to respond faster to potential fraud attempts should be in place.
- Real-time Monitoring: Implement real-time monitoring of user activity and transactions.
- Alerts: Set up alerts for suspicious activity (e.g., unusual login attempts, large transactions).
- Reporting: Generate regular reports on fraud trends and patterns.
However, remember that your efforts to secure gamers should enhance the experience for your users.
Balancing the needs of diverse user groups can be challenging, but it is essential to consider how compromises might affect user experience.
Online Gaming Fraud Prevention Checklist
Protect your SaaS gaming platform from costly attacks.
-
Actionable steps to identify vulnerabilities
-
Key security measures to implement
-
Best practices for data protection
-
Risk assessment guidance
-
and more!
Employ AI for Time-Consuming Tasks
Artificial Intelligence, in its various forms, has proven to be of great use in gaming fraud or online fraud in general. It is important to acknowledge that AI’s efficacy is significantly impacted by the availability of large datasets. The selection of a dependable partner with extensive knowledge in this field plays a significant role in maximizing the effectiveness of collaborative efforts.
AI algorithms actively seek to detect and reduce instances of fraudulent activity in the gaming realm:
Countering Fraudulent Activities: Utilize AI-driven identity assessment to identify and address potential fraud scenarios across various touchpoints, including account creation, promotions, digital payments, and chargebacks.
You want your program to be able to analyze new user accounts and label a user as fraudulent or not fraudulent. This method permits the optimal allocation of resources by enabling the analysis of possible fraud-related data with a higher emphasis on investigating accounts with a higher likelihood of authenticity.
Live User Monitoring: While real-time user monitoring can provide valuable insights, it can be difficult to implement due to technical constraints. Fraud risks can be handled through automated AI-powered detection tools. This kind of software can track user activity on a centralized dashboard, allowing for the identification of suspicious accounts and the monitoring of revenue streams.
Use Device Intelligence Technologies: These methods allow businesses to collect detailed device information from users.Device Intelligence identifies a device and flags abnormalities each time a user logs onto your game.
Device Intelligence includes device fingerprinting, AI-driven fuzzy matching, and advanced AI models.
Online Gaming Fraud Prevention Checklist
Protect your SaaS gaming platform from costly attacks.
-
Actionable steps to identify vulnerabilities
-
Key security measures to implement
-
Best practices for data protection
-
Risk assessment guidance
-
and more!
Maximize Machine Learning to Predict Fraudulent Behavior
The evolving nature of fraudulent methods necessitates a continuous review of detection processes to ensure effectiveness. Your fraud detection software needs to be able to learn every time fraud is detected so that you can stay ahead of any corrupt activity.
It must utilize the latest technology, specifically AI and machine learning. The system can refine its protection over time if it accurately identifies and analyzes instances of fraudulent activity.
- Fraud mitigation: Leverage AI and machine learning to identify and flag suspicious patterns suggestive of fraudulent activities.
- Anomaly Detection: Implement anomaly detection systems to identify deviations from normal behavior.
- Predictive Analytics: Use predictive analytics to anticipate future fraud attempts.
- Adaptive Algorithms: Use machine learning algorithms that adapt to new fraud techniques.
- Continuous Learning: Ensure your fraud detection system continuously learns from new data and feedback.
PayPro Global offers dedicated assistance in recognizing and mitigating the risks of friendly fraud, involving the following:
- Purchase history and previous customer complaint verifications
- Data science & AI mechanisms used to track particular patterns
- Proxy/VPN inquiry to analyze the fraudster’s IP (essential in disputes)
- To effectively safeguard against account takeover, we need to establish secure communication channels between your systems and ours, allowing us to acquire all essential customer data.
- Customizing order verification based on specific criteria and/or shopper persona.
Online Gaming Fraud Prevention Checklist
Protect your SaaS gaming platform from costly attacks.
-
Actionable steps to identify vulnerabilities
-
Key security measures to implement
-
Best practices for data protection
-
Risk assessment guidance
-
and more!
Use Strong and Adaptable KYC Verification Checks
As we’ve stated, it’s essential to strike a balance between security and user experience. You need to know who your customers are and which ones have suspicious profiles. It’s essential to strike a balance between security and customer experience. Maintaining an effective balance in the level of verification is necessary to avoid deterring legitimate customers with excessive checks.
Not all customers require the same level of verification. Adaptable KYC checks play a key role in verifying customer identities, particularly in today’s rapidly evolving technology landscape. Your fraud detection software should be able to run a digital footprint analysis on users and identify which ones require light KYC and which ones require heavy KYC.Soft KYC methods carry a higher risk, but their impact on customer churn is generally minimal.
More serious methods require more user information, but will weed out most fraudsters. Automation can reduce the time required for the process, potentially decreasing the need for manual review.
- Risk-Based KYC: Implement risk-based KYC procedures. Higher-risk users require more stringent verification.
- KYC automation: Minimize manual review for efficiency in KYC processes.
- KYC Provider: Partner with a reputable KYC/AML provider.
Utilizing velocity rules in conjunction with these methods may contribute to a more comprehensive understanding of fraudulent behavior within gaming platforms. It may be beneficial to incorporate this information when formulating and enacting your strategies for preventing fraud.
Conclusion
The ever-changing nature of online gaming necessitates continuous efforts to detect and prevent fraud. As the techniques employed by fraudsters and scammers change over time, the methods used for fraud detection must also be continually updated.
To ensure smooth operations during crucial growth phases, companies must be diligent in their efforts to identify and prevent fraudulent activities. The growing popularity of Merchants of Record is likely influencing the decision-making process for many SaaS businesses.
Partnering with the right eCommerce platform, equipping your team with proper data, tools, and knowledge can significantly reduce the risks associated with online gaming scams. PayPro Global is a provider of eCommerce solutions and the platform has been available in the market for a while. Our expertise encompasses various domains, including SaaS online sales, online gaming, and fraud prevention. Partner with us for comprehensive assistance in these areas.
FAQ
-
Protecting against account takeover is essential for safeguarding user information and preventing fraud. Fraudsters gaining access to legitimate accounts can lead to data breaches, service disruption, and reputational damage, impacting both the business and its users.
-
Conduct a self-assessment considering factors like your business model (freemium vs. enterprise), user base size and diversity, data sensitivity (PII), and any past fraud incidents. This helps determine the level of security measures you need.
-
Some eCommerce platforms like PayPro Global offer various tools and services, including fraud detection, risk assessment, and recurring subscription handling. These services relate to businesses that focus on enhancing operational efficiency and possibly reducing security risks. They manage the complexities of online payments and fraud.
-
Monitor login attempts (especially failed ones), transaction volumes, API usage spikes, and changes in user behavior.Being aware of these kinds of signs can help identify potential fraudulent activity, however, it doesn’t provide absolute certainty.
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