Decoding Promo Abuse: Protection Against iGaming Fraud

One of the key goals of any iGaming or betting business is to create something compelling for players. This is where the allure of promotional offers and bonuses is undeniable. Lurking beneath the surface, however, is a growing concern — the sophisticated art of promo abuse. This is something that is almost always present in online gambling fraud. As companies strive to attract and retain users through enticing incentives, understanding and combating promo abuse becomes essential. Now let’s unveil our educational exploration, as we delve into the intricacies of promo abuse, its impact on the industry, and effective strategies to mitigate this form of fraudulent activity.

What is promo abuse and how it works

Online gambling and betting (or iGaming) are a huge market that continues to grow. Promotional offers represent a key element in attracting players, but they are often accompanied by a shadow in the form of strategic exploitation (i.e. promo abuse). This section explores the fundamental aspects of promo abuse, unraveling its definition, the techniques employed, and the impact on businesses.

Promo abuse definition and meaning: promo abuse is not mere opportunism but a deliberate and systematic exploitation of promotional incentives offered by businesses. It involves individuals strategically manipulating promotional offers to gain undue advantages, disrupting the intended equilibrium of reward and user engagement.

Techniques employed: perpetrators employ various techniques, from identity manipulation to automated scripts, to exploit promotional loopholes. The sophistication of these techniques challenges businesses to stay ahead in the ongoing cat-and-mouse game against those seeking to subvert promotional systems.

Fraudulent activities: individuals engaging in promo abuse often orchestrate fraudulent activities, ranging from creating fake accounts to coordinating with others for mutual benefit. The objective of such fraudulent activities is clear: maximize gains while minimizing the risk of detection. Promo abuse is not a passive act but a strategic endeavor to extract the maximum value from promotional campaigns.

Impact on businesses: the ramifications of promo abuse extend beyond immediate financial losses. Businesses face reputational risks as promo abuse compromises the perceived integrity of their promotional strategies. To comprehend the scale of this challenge, we turn our attention to industry statistics that shed light on the prevalence and severity of promo abuse.

Real-world scenarios: examining real-world scenarios provides insight into the evolving tactics employed by promo abusers. Through case studies, we witness the adaptability of these individuals and the urgency for businesses to deploy proactive measures.

First, we must distinguish between the different types of promo and bonus abuse.

Common types of promo and bonus abuse

While promo abuse is on the rise, businesses still strive to attract and retain users through enticing incentives. To combat promo abuse in online gaming fraud, companies first need to understand some of the subtleties of this phenomenon; so let’s explore what are the common types that challenge the integrity of promotional strategies.

Referral bonuses: referral bonuses, designed to reward users for bringing in new customers, can be exploited by unscrupulous individuals. Through various tactics, abusers maximize gains by creating fictitious referrals, undermining the genuine purpose of this promotional strategy.

Sign-up bonuses: sign-up bonuses, a staple in user acquisition, are susceptible to abuse. Individuals may exploit vulnerabilities in the sign-up process, creating multiple accounts to reap rewards. This jeopardizes the integrity of the sign-up bonus system and poses challenges for businesses in ensuring genuine user engagement.

Other bonus forms: various bonus structures, from loyalty rewards to seasonal promotions, are not immune to abuse. Abusers continuously evolve their methods, challenging businesses to adapt and fortify their promotional strategies. The consequences of unchecked abuse extend beyond financial losses, tarnishing the reputation of businesses in the eyes of genuine users.

From this point on, we have discerned the common types of promo abuse, which lays the groundwork for recognizing its multifaceted nature. The next step is to pivot toward industry statistics, unraveling the quantitative dimensions of this pervasive challenge.

State of the online gambling market

It has to be stressed that we are talking about a massive market that is still growing. ​​In the US, for example, a record 50.4 million US adults are expected to bet $16Bn on the game during Super Bowl Sunday. Meanwhile, statistics reveal that income generated from European gambling in 2022 reached almost $100 billion.  

However, this gigantic industry is also extremely vulnerable to fraud, and the more it grows, the more it becomes fertile ground for scams and igaming businesses are frequently in the crosshairs. There are concerning statistics such as 1500 people arrested for online fraud and according to the Ministry of Digital Economy and Society (DES). Promo abuse, bonus abuse, chip dumping, and similar acts are part of a powerful web that exists in the realm of online gambling fraud. 

There is a way to address this. By synthesizing quantitative data with our understanding of the tactics employed, we gain a holistic view that informs the strategies needed to safeguard promotional integrity.

With a glimpse into the statistical dimensions of promo abuse, the focus shifts to actionable measures and the role of risk intelligence in countering this evolving challenge.

Countermeasures against promo abuse

In the perpetual battle against promo abuse, businesses must deploy robust countermeasures to safeguard the integrity of their promotional offerings. This section explores effective procedures to combat promo abuse and highlights the pivotal role of risk intelligence in this endeavor.

Procedures to counter promo abuse: implementing stringent procedures is a vital step in mitigating promo abuse. This includes thorough user verification processes, monitoring for suspicious activities, and swift responses to potential abuse cases. By establishing a proactive defense system, businesses can create hurdles for would-be abusers, discouraging fraudulent attempts.

The role of risk intelligence: enter risk intelligence—the cornerstone of a comprehensive defense strategy. By harnessing alternative data gathered through digital signals such as phone, email, IP, and device, businesses can fortify their promotional systems. Risk intelligence not only detects abnormal patterns indicative of promo abuse but also enables a swift and informed response to neutralize potential threats.

As we grasp the significance of risk intelligence, the next section delves into crafting a comprehensive strategy to safeguard against promo abuse.

Crafting a comprehensive strategy

The iGaming and online gambling market is constantly evolving and growing, so mitigating promo abuse requires a comprehensive strategy that addresses vulnerabilities at every level. This section explores the key components of such a strategy, emphasizing the importance of a holistic approach.

Building a holistic approach: a piecemeal approach is insufficient when combating promo abuse. Businesses must adopt a holistic strategy encompassing user education, system enhancements, and collaboration with industry peers. By addressing promo abuse from multiple angles, businesses create a resilient defense system that adapts to evolving threats.

Educational initiatives: empowering users with knowledge is a proactive step in the fight against promo abuse. Businesses can institute educational initiatives to inform users about the consequences of fraudulent activities and the importance of ethical engagement. An informed user base becomes a valuable ally in maintaining the integrity of promotional systems.

Verifying affiliates: betting businesses can online gambling fraudsters at bay by keeping user acquisition safe by verifying affiliates, spotting fraudulent traffic, and stopping lead-gen and CPA fraud.

Safer player onboarding: when onboarding players, utilizing digital footprints can help verify players and cut manual review times. Accumulating this data and analyzing the various trust and risk signals increases the chances of spotting an online gambling fraud strategy before it even happens. 

These are not the only systems of online gambling fraud detection out there. You can discover more about the latest methods of fraud protection against promo abuse, which will set you on a path to unlocking a safer player experience.

How to cut fraud and finally stop promo abuse

This is just the tip of the iceberg when it comes to protections against such forms of fraud. Safeguarding against promo abuse requires a multi-faceted approach that blends robust procedural measures, the power of risk intelligence, and educational initiatives. As businesses navigate the complexities of the igaming and online gambling landscape, proactive strategies are key to preserving the value and fairness of promotional offerings.

Reach out to our experts and create a safety net against fraudulent activities in the betting realm, while staying compliant with regulations.

In conclusion, remember that these are not the only forms of online gambling fraud. Other types of fraud exist in this marketing including gnoming, multi-accounting, chip dumping, and more. To learn more about these issues and industry trends, we invite you to stick with us as we expand the “Risk Academy” library.