Combating Account Takeover in Online Gambling

Account takeover attacks are a growing challenge in the online gambling industry. Operators need a multi-layered approach to comprehensively protect user accounts from this rising scourge

In 2023, the global online gambling industry generated revenues of around $26.14 billion with a user base of nearly 1.13 billion. This growth, both in terms of revenues and users, makes online gambling attractive for several types of fraud.

One of the rising fraud trends in the industry is increasing account takeover attacks, where a fraudster gains access to genuine user accounts using stolen credentials. The compromised accounts are then exploited for microtransactions, money laundering, placing bets, and other criminal activities, such as phishing, accessing funds, card-not-present (CNP) fraud, and so forth.

How Does Account Takeover (ATO) Work?

Today, even the not-so-skilled fraudsters can launch gambling account takeover attacks at scale, using outsourced services such as bots-as-a-service, easily available commoditized toolkits, and low-cost human labor.

Some common methods used for gambling account takeover are:

• Phishing: Impersonating service providers or people to send out email or text messages and trick users into sharing personal or financial information. With sophisticated man in the middle attacks, fraudsters can intercept OTPs sent to users for authentication.
• Credential Stuffing: Using bots to test compromised credential combinations on several websites or apps to get valid username-password combinations.
• Password Cracking: Automating the use of leaked or stolen usernames with dictionaries of common passwords.
• Brute Force Attacks: Trying different variations of words, numbers, and symbols to figure out the correct password.
• Session Hijacking: Bypassing authentication for gambling account takeover by stealing tokens.
• Data Breaches: Stealing sensitive personal information such as email, phone number, Social Security Numbers and passwords to sell on the dark web or to power gambling account takeover fraud.
• Malware: Installing malicious software on a user’s gaming device to track account activity and steal sensitive information.
• Artificial Intelligence: Using generative AI to create more believable emails, text messages, deepfake videos, fake audio messages to power phishing and social engineering campaigns and dupe users into sharing personal details.

Consequences of ATO Attacks

Not only does gambling account takeover lead to financial losses in the form of chargebacks, refunds, account restoration costs, and revenue loss, but also disrupts services, degrades user experience, and causes reputational damage to online gambling platforms.

Fraudsters can use compromised accounts to collude and cheat genuine players, compromising the integrity of the games and undermining the trust of legitimate players. When discontented users post negative comments on social platforms, the ability to retain or attract users gets impacted, causing loss to business.

Gambling account takeover can expose all stakeholders – game developers, distributors, financial services providers, and digital infrastructure vendors – to data breaches and financial losses. Further, the inability to protect user accounts can expose online gambling platforms to regulatory penalties, legal action, and additional scrutiny.

Identifying the Red Flags

Operators can fight gambling account takeover attacks by actively monitoring signals of ATO attacks and taking timely action. Some telltales include:

• Unusual Login Behavior: Login attempts from a new device, location, or a time that deviates from normal user behavior pattern. 
• Numerous Failed Login Attempts: Multiple failed log-in attempts in a short period of time, indicative of a brute force attack attempting repetitive guessing a password. 
• Unexplained Spike in Login: Suggests use of bots to overwhelm the system.
• Changes to Account Details: Unauthorized changes to account details such as email, phone number, account recovery details, all at once.
• Request for password changes: Bulk requests for change of user account passwords.
• Surge in Chargebacks: Sudden increase in suspicious purchases from new locations and chargebacks.

Stopping Account Takeover Attacks on Online Gambling Platforms

To fight an adversary that has easy access to technology and evasion tools, online gambling platforms need a multi-layered approach that incorporates:

Robust KYC:

Thoroughly verify user identities, complete with background checks through official documentation. Conduct ongoing KYC to keep player profiles up-to-date.

Using Multi Factor Authentication (MFA):

Introduce multi factor authentication (MFA) to add a layer of security and make it harder for fraudsters to gain unauthorized access to user accounts.

Account Monitoring:

Monitor existing users’ account activity in real time to spot suspicious in-platform activity and intervene, as needed.

IP and Device Tracking:

Monitor IP addresses and device information to detect and flag suspicious activities.

Anti-fraud Algorithms:

Use advanced machine learning to analyze account activity, player behavior and detect patterns such as betting patterns, deposit and withdrawal activity, and account history.

Data Encryption:

Use data encryption techniques to protect user accounts from unauthorized access.

Fraud Detection Software:

‍Use AI-powered fraud detection software to identify and flag suspicious activity in real time. Choose solutions that help comply with evolving regulatory requirements.

Audits and Reviews:

Conduct regular audits, reviews, and penetration tests to identify and plug in vulnerabilities before fraudsters can exploit them.

Incident Response Plan:

Establish protocols for swift investigation and response to ATO attacks.

User Education:

Educate users on identity theft, identifying and responding to phishing and social engineering scams, and adopting security best practices.

How Caf Helps Prevent Account Takeover Attacks

Caf is the go-to-expert in tackling varied challenges that the online gambling industry faces. With a comprehensive and flexible solution in Bet ID, Caf delivers total protection against gambling account takeover while delivering the best gaming experience.

From secure collection of player information to using technologies such as CPF (Brazilian Taxpayer Registry), facial recognition, and document analysis for accurate user identity verification, Caf ensures only legally allowed bettors can access the platforms; while barring under-age individuals or those present on restricted lists. Offering over 50 data sources for user information validation, Caf helps gambling operators comprehensively protect user accounts and stay compliant with the prevailing regulations.

Using market-leading technologies, such as biometric document verification and post-onboarding MFA, Caf’s automated and seamless user verification helps detect unusual gambling behavior, validate user identity, and ensure complete protection against gambling account takeover attempts. To see Bet ID in action, book a demo now.

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