How to Detect and Prevent Online Gaming Fraud

Fraud has been increasing steadily with the rise of online gaming. Any online platform is a potential target for fraud, and managers should be aware of the risks involved. Gaming is especially vulnerable due to low-security payment systems, poor communication, and easily stolen user-tradeable items. Furthermore, user accounts are often poorly protected and at risk of credential stuffing attacks.

The number of people using online gaming platforms is enormous. In a recent study, researchers found that 67% of adults and 76% of kids younger than 18 in the U.S. play video games—that's hundreds of millions of people in one country alone. It's simple for anyone to pick up their smartphone and download a game, and it's just as simple for fraudsters to target them.

Online Gaming Fraud Trends

Below are some common online gaming fraud techniques to look out for. While some of these primarily affect the user and not the platform, fraud managers should nevertheless be aware of them.

• Credit card fraud. Stolen re the most common ingredients used in online fraud. Card Not Present (CNP) a fraudster attempts to purchase something like in-game currency with a stolen card, steadily increasing amounts to test detection limits. Chargebacks hurt a platform's standing with financial institutions.
• Multiple accounts. Credential stuffing means using information from data breaches to attempt to break into accounts on another platform. Many people use the same password for all their accounts, making it easy for a fraudster to mass input account details and collect compromised accounts. These accounts can then be sold, used to exploit the game, and more.
• Phishing. A fraudster creates a fake website which mimics a legitimate one, then tries to deceive a user into entering their account and payment details. Phishing has become more sophisticated over the years, and many users don't know they've been defrauded until it's too late. The fraudster can then use the stolen credentials to perpetuate gaming payment fraud.
• Exploiting promotions. Promotions, sales, and other bonuses incentivize users to perform certain actions. Gaming platforms must be careful to block individuals with multiple accounts from compounding benefits.
• Viruses. Fraudsters can advertise "tools" that claim to increase in-game currency, give free items, or provide some other in-game advantage. These tools are usually viruses that don't deliver the promised benefits, and even legitimate tools can exploit the gaming platform.
• Item and currency trading fraud. Users may trade in-game currency and items on third-party websites outside the gaming platform's control. Such trading and gambling platforms are often unsecured, or outright scams.

How to Avoid Online Gaming Fraud

Be aware of how fraudsters operate and test for vulnerabilities—prevention is always better than a cure.

Unfortunately, avoiding online gaming fraud completely is impossible. Fraudsters actively work to find new and improved methods of exploiting systems. A gaming platform must learn to react quickly to any detected fraud and prevent it from snowballing.

The most effective way to reduce online gaming fraud on your platform is to use a fraud protection platform like nSure.ai. Such platforms use advanced machine learning techniques to detect and stop fraud almost in real time. nSure.ai is a much more effective solution than traditional methods, which can increase customer friction. Friction makes it harder for legitimate users to access the platform, which risks chasing them away and losing sales.

Useful Tips for Detecting Online Gaming Fraud

If any fraud gets out of hand, users quickly lose trust in a platform. Therefore, it's essential to detect fraud and shut it down early, before it can spread and affect more users.

• Payment fraud detection software. Machine learning works faster and processes more than any human can, allowing payment fraud to be detected around the clock and in real time.
• Communication. Better communication with users allows the gaming platform to notify them of possible fraud attempts on their accounts. Stealing an account is usually a lengthy process, so detecting possible fraud and alerting the relevant user is a crucial first step to nipping it in the bud.
• Analytics and metrics. Using monitoring tools to see which user accounts are behaving suspiciously (suddenly winning a lot, having an abnormally high amount of in-game items, etc.) can go a long way in the early detection of fraudulent or compromised accounts.