Bonus abuse has emerged as the leading fraud threat facing North America’s online gaming industry, as criminals increasingly exploit promotional incentives and sign-up offers to generate illicit profits. A new industry survey suggests the problem remains a constant concern for operators trying to grow their customer base.
LexisNexis Risk Solutions questioned nearly 1,000 decision-makers working in online gaming. Most respondents said the situation has not improved, with 78% reporting that fraud levels have not declined at their companies.
The findings appear in the report Fraud and Identity Industry Pulse: Online Gaming in North America. It describes an industry trying to attract new players while also blocking criminals who target bonuses, payment systems and account creation tools.
Bonus abuse leads the online gambling fraud landscape in North America
Among all reported threats, bonus abuse stands out as the most common problem operators encounter. Other frequent tactics include multi-accounting, affiliate fraud and the use of stolen identities.
Bonus abuse typically involves people repeatedly opening new accounts to claim promotional incentives such as deposit matches or free bets. Once the benefit is used, the account may be abandoned and replaced with another newly created profile.
Researchers say the process has become easier for fraud networks because email addresses and phone numbers can be generated or acquired quickly. That allows offenders to cycle through large numbers of new accounts with minimal effort.
Kim Sutherland, senior vice president of market planning at LexisNexis Risk Solutions, described how organized groups mask their activity.
“Gaming fraudsters conceal their locations and scale attacks by using VPNs and proxies to hide their true digital identity,” Sutherland said in the associated release. “Tracks are then covered using multiple devices never linked to the same email address, with criminal networks in place ready to exchange stolen gaming account details, match bets and continue the endless cycle of bonus abuse.”
According to the company, analysts have uncovered networks responsible for more than 95,000 fraud events linked to a single bonus-abuse operation. In some cases, the potential exposure from one scheme has climbed to roughly $3.2 million.
Recent criminal investigations show similar tactics playing out in real life. In February, prosecutors charged two Connecticut men who allegedly used thousands of stolen identities to create betting accounts and exploit promotional offers on platforms including FanDuel. Authorities say the operation generated more than $3 million.
State regulators in Connecticut have also flagged a separate case tied to DraftKings. Investigators say recruiters approached people online and in person, asking them to open sportsbook accounts using credit cards connected to stolen identities. At least 15 arrests have already been made in that investigation.
For operators, the cost of fraud extends well beyond the immediate loss of money. Companies surveyed by LexisNexis said direct financial losses remain the biggest concern, but compliance burdens and customer churn are also significant consequences.
The value of individual fraudulent transactions varies widely. Two out of five respondents said the typical loss falls between $50 and $100, while more than one in five reported average incidents exceeding $200.
Fraud tends to appear most often at key points in the customer journey. Account registration and withdrawals are especially vulnerable, with roughly 60% of suspicious activity occurring during those stages.
To limit exposure, many gaming companies now rely on layered protection systems. Operators reported using combinations of manual monitoring, document verification and device fingerprinting, along with tools such as geolocation checks, behavioral biometrics and digital identity verification.
Even with those safeguards, companies remain cautious about introducing too many hurdles for legitimate users. Survey respondents said excessive friction during sign-up can discourage new players, creating a constant balancing act between security and customer experience.
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The post Bonus abuse surges across North American online gaming platforms, report finds appeared first on ReadWrite.
This articles is written by : Nermeen Nabil Khear Abdelmalak
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