Artificial intelligence vs. fraud: how AI is transforming anti-fraud in the iGaming industry

Volodymyr Todurov, CEO Frogo, adopts a focus on key industry talking point, notably that of AI, and examines just how critical the technology will become in the ever evolving fight against fraud.

The iGaming industry has grown rapidly, with estimates suggesting it will exceed $100bn in the global market by 2025. Despite its growth potential, this expansion has been the breeding ground of rash frauds that threaten both operators and players. 

Traditional methods for detecting fraud, such as manual reviews and static rules, are increasingly unable to address the sophisticated tactics modern fraudsters employ. Any hope for tackling this problem can only be pinned squarely upon Artificial Intelligence, the transformative force redrawing the fraud prevention landscape in iGaming. 

The number of users utilising AI tools exceeded 250min 2023, more than twice the figures from 2020. Additionally, the global market for generative AI is estimated to be worth $45bn in 2023, with projections reaching $206bn by 2030. 

Fraud-as-a-Service is increasingly prevalent, with 56% of fraud analysts reporting activity from fraud rings in 2023. Digital tools are readily shareable, enabling fraudsters to collaborate in creating AI-driven fraud schemes. That is why every company with a large number of users and tons of financial transactions needs a strong fraud detection line. 

Typical fraud schemes in iGaming 

Fraud in iGaming manifests in various forms, including: 

• Bonus Abuse: exploiting promotional offers without genuine intent to play. 
• Affiliate Fraud: manipulating referral programs to generate illegitimate earnings.
• Money Laundering: using gaming platforms to process illicit funds. 
• Account Takeovers: unauthorised access to user accounts to exploit bonuses or withdraw funds. 
• Selfie Mismatch: employing deepfake technology to bypass identity verification processes. 

AI’s ability to analyse user behaviour and detect anomalies is crucial in identifying and mitigating these fraudulent activities. 

AI’s transformative impact on fraud detection 

AI’s role in transforming fraud detection in iGaming is multifaceted: 

• Real-time risk assessment: AI-powered systems process real-time data quickly, allowing the platform to flag or block suspicious transactions. This urgent reaction can lower the impact of fraudulent activities. 
• Predictive analysis: by learning from historical data, AI models can predict potential fraud scenarios and plan measures to obstruct them. 
• Enhanced user verification: by analysing biometric information, documents ‘ authenticity, and other user-submitted material, AI reduces the risk of fake accounts and identity theft. If AI is running, player collusion can keep the games fair – notably, games like poker that require skill; only when two players work together will they be visible to human watchers. 
• Pattern recognition: AI is good at finding repeating patterns, such as using the same device or IP address across several different accounts, even ones disguised so that relatively few people notice. 
• Automated solution to bonus abuse: by tracking and analysing player behaviour across many accounts and platforms, the AI system can root out any rogue who tries to exploit promotional offers. 

Frogo: a comprehensive AI-driven anti-fraud solution 

Recognising the need for advanced fraud prevention tools, we developed Frogo – an all-in-one anti-fraud platform designed to help online businesses effectively manage risks and combat fraud. 

Here are some key options of Frogo platform: 

• Device fingerprinting: this method detects high-potential fraud behaviour by analysing unique device data. 
• Dynamic trigger scoring: by real-time risk assessment using both fixed and dynamic triggers, it can make more accurate predictions about fraud case detection. 
• AI module: it continues to learn from fraud patterns and adapts as new threats enter the field. 
• Predictions of VIP users: learn about your loyal users and provide them with a better experience. 
• Graph-based forensics: uses a graph to join multiple accounts that exist only in name to each other and put together the fraud rings like a detective piecing together the complete picture. 

Through these tools, companies are capable of detecting and preventing fraud before it even starts – involving bonus abuses, financial fraud, collusion between workers at the same company, proxy servers, double (or more) accounts used by affiliates, insiders forcing odds or results through manipulation, and everything else you can think of. 

iGaming’s future fight against fraud 

As fraudsters continue to change the rulebook with their innovation, we must inevitably adapt strategies to counteract them. 

AI means from stringent to pre-emptive, enabling casinos to forecast and prevent fraud before its occurrence rather than just kick it out afterward on each alert the system gives. 

Integration of AI into fraud prevention schemes does more than just provide added safeguards. It also enhances the confidence of users in security so that they can trust what they see without fearing a scam attack. 

The melding of AI with anti-fraud measures is revolutionising the iGaming industry. Frogo is a fine example of what AI-driven solutions bring to a company, keeping both business interests and clients safe. 

As an increasing number of companies use AI, fraud prevention’s future looks bright with smarter and swifter systems to pave us in good stead.