US Online Gambling Operators Seeing High Player Fraud


US online gambling fraud attempts declined 16% this year, TransUnion told Online Poker Report today. That’s a good sign, but those rates are still higher than Europe’s, TransUnion’s Declan Raines noted to OPR.

Raines, the head of US gaming for Chicago-headquartered TransUnion, said those US fraud attempts usually take the form of online casino and online sportsbook bonus abuse by consumers. They also include online poker chip dumping by players, he said.

Raines put US online gambling fraud in perspective as his company released new research yesterday. In 2022 Digital Fraud Trends Analysis, TransUnion found suspected digital fraud attempts against legal gambling operators around the world increased 50.1% from Q1 2021 to Q1 2022. Similar to the US, the predominant form of fraud is promotion abuse.

Meanwhile, the research found that suspected global online fraud attempts against all industries declined by 22.6% during that same timeframe. In the US, it’s down 23.1%.

European operators have more experience with fraud

Shai Cohen, senior vice president of global fraud solutions at TransUnion, said in yesterday’s announcement:

“Sophisticated fraudsters pressure test which industries have ramped up fraud prevention measures and as a result, turn to new industries if efforts are being thwarted. That’s exactly what we have observed recently as fraudsters look for new opportunities or points of vulnerability. It is paramount that during this dip, companies focus on optimizing the customer experience for good customers.”

Raines said the US online gambling marketplace is just that new industry.

Fraudster attempts against US online gambling operators are high at the moment, Raines said. That’s because industry professionals here are just learning, he said.

European online gambling operators are more experienced and, therefore, more successful at spotting and preventing such attempts. That’s because their marketplaces are mature, Raines told OPR.

He added that TransUnion only works with legal online gambling operators. These stats, therefore, don’t include fraud by, or against, illegal offshore sites.


Declan Raines, head of US gaming for TransUnion, talks to OPR about US online gambling fraud

Declan Raines, Head of US gaming, TransUnion

How US online gambling fraud compares

Today, TransUnion provided OPR with online fraud rates in the US compared with global rates during Q1 2022 vs. Q1 2021.

The year-over-year measurement breaks down as so, TransUnion told OPR:

“Globally, overall suspected online fraud attempts declined 22.6%.

“However, suspected online fraud attempts in the global gambling industry were up 50.1%

“In the US, overall suspected online fraud attempts declined 23.12%, with suspected online fraud attempts in the US gambling industry down 16.18%.”

TransUnion works to prevent online gambling fraud

As a consumer credit reporting agency, TransUnion works with businesses and consumers to try to prevent fraud.

Among the services it provides to online gambling operators is the identification of “suspicious users, devices and transactions.”

As a result, TransUnion is finding one of the forms of attempted fraud against US online gambling operators comes from members of exclusion lists who are using different emails in order to try to bet.

However overall attempted fraud numbers for US online casino, online poker and online sports betting are about equal, Raines said.

In other words, attempted fraud is no higher in online poker, in terms of prevalence in the US online gambling vertical, Raines said. That’s true even though all are experiencing attempted bonus abuse, while only online poker is a target for chip dumping, he said.

What’s chip dumping, and why is it a problem?

Chip dumping, as explained by Raines, is when two players collude to have one bettor lose chips to the other on purpose.

While it’s a common tactic in money laundering, it can also be a way to transfer a bonus to a conspirator. (Editor’s note: It can also be used by players acting as a team in a poker tournament. In that case, the victims of the fraud are the other players participating in the tournament, rather than the site.)

Gibraltar-based 888poker said chip dumpers will have their funds confiscated and be permanently banned.

The online poker operator, which also has a presence in the US in partnership with WSOP, added that innocent players sometimes get caught in crackdowns against chip dumping, too:

“Naturally, more intelligent chip dumpers my try to conceal their actions. For a start, they try and make their dumps appear like legitimate hands. (No Ten-high call downs, for example.) Also, while attempting to chip dump to a specific account, they take care to also splash large quantities of chips in the direction of random players at the table. (To give the impression they are spewing money against everyone.) Unfortunately, when such chip dumpers eventually get caught, some of the random recipients of their dumps may also be implicated in the chip dumping scam and have their accounts flagged by the site.”