Online Casino Fraudsters Investigated

The online gambling industry is truly diverse. The bright and shiny side is all the reliable online casinos with new and exciting games and immersive bonuses. There is, however, another side to it—a shadier one. It is the side that regular players are rarely aware of, and yet it impacts them and their gambling experience most dramatically. We are talking about fraudsters.

The industry has always been a playground for fraudsters. These used to be mostly inventive individuals on their solo missions to trick the system. These days, however, scammers have become smarter, more strategically organized, and now work in teams. They are not after tricking casinos or systems anymore. They are out to scam players like us, too.

This research might come in handy for all of the players wagering real money online, as information is power. We will take a closer look at the latest tricks and behaviors that fraudsters lean into, and will also expose the insane sums of money that are being stolen. On the positive side, we will acknowledge ways in which the online operators are fighting back. There will also be tips and recommendations on how to stay protected from getting caught in the crossfire. 

So, shall we talk about the shady things happening behind the scenes of online gambling?

The Simpler Times When Only Our Payment Card Information Was Targeted

It seems like not that long ago, our only concern was to protect credit or debit card information from getting exposed when making payments online. The internet was filled with stories of someone discovering their cards were used to deposit and then cash out funds online. Don’t get us wrong, stealing card information is still very much a common thing (sadly). However, it has become only the tip of the iceberg.

If we dive deeper, we will discover a whole business with groups running a so-called “fraud as a service”. If you are shopping for some, you will be able to purchase bots, scripts, fake accounts, you name it. Some even offer tools to bypass security checks across gambling sites or even target new player bonuses. In other words, there are now plenty of instruments to help someone cheat the system. Just to be clear, we’re by no means promoting them, just merely shining a light on how the ecosystem evolved.

Here’s where it gets fascinating: these scams rarely look dramatic. An organized team might open a thousand fake accounts to collect seemingly uneventful 10-Euro promotions. These are sums that rarely alert the system. However, when they add up, we’re looking at 10,000 Euros vanished in a day. And the procedure to succeed on this mission is ridiculously simple — the teams use bots to create accounts, emulators to fake devices, and stolen data to pass KYC checks. They move fast, adapt faster, and cost the industry big money.

Fraudsters Are After Big Rewards

Spoiler alert: they’re getting them!

Another spoiler: this is now turning into a billion-dollar problem for the industry. Some reports suggest that the cost of elaborate scams has amounted to 1.2 billion USD in recent years to elaborate scams. That’s how much online casinos lost. If we zoom in on this sum, it consists of:

• Bonus abuse (makes up around 35% of all fraud cases).
• Credit card fraud and chargebacks (take another 25%).
• Account takeovers and stolen credentials are growing fast (around 20% of all fraud cases now involve stolen logins).

These are just on-the-surface consequences. That’s not all the damage, though, as frauds of this scale send ripple effects across the industry. An online operator affected by a scam usually takes action like changing the rules and policies, making them stricter. This, in its turn, leads to more meticulous verifications and ID checks, payout delays, and even cutting back on bonuses. In other words, we, the players, get to bear the cost of scams, emotionally and financially.

You might wonder — how do scammers even make so much money from a site? Here’s an example. One group used bots to target a gambling site with SMS-based security codes, an elaborate tactic. They found a way to bypass the codes, created thousands of fake accounts, and raked in over €100,000 before the site caught on. A company that did a security check helped stop it, but only after the damage had been done.

The Most Common Scams to Be Aware Of

If you play online even occasionally, it helps to know what kinds of scams are out there. Some fraudsters try to trick the gambling site. Others aim straight at players like you. Either way, the more you understand, the better your chances of avoiding rogue practices.

Here are the most common types of fraud happening today:

• Bonus Abuse: This one is everywhere. Fraudsters create dozens, sometimes thousands, of fake accounts to claim welcome bonuses. They use different names, devices, and even fake addresses. The goal is to grab casino spins or extra cash and cash out without ever playing fair. The problem is, some systems can’t tell the difference between a real new player and a bonus hunter with ten fake accounts.
• Account Takeover: If someone gets hold of your login details, they can take over your gambling account. They might deposit using a stolen card or withdraw your balance to another wallet. Many of these cases happen because people reuse passwords across different sites. If a data leak happens somewhere else, scammers may try your login on a gambling site. And it often works.
• Credit Card Fraud and Chargebacks: Fraudsters use stolen credit or debit cards to make deposits. They play a little, withdraw quickly, and then the real card owner files a chargeback. The platform ends up with lost money, angry banks, and blocked players — sometimes even legitimate ones get caught in the mess.
• Bot and Emulator Attacks: Some scams use bots that act like human players. These bots can run 24/7, collecting loyalty points or unlocking rewards. Others use device emulators to look like real phones or computers. They can even copy the way real users behave, which makes them hard to detect.
• Money Laundering: Some people use online operators to “clean” dirty money. They deposit large sums, play just enough to avoid suspicion, and then withdraw most of the funds. This hurts the platform’s reputation and brings strict attention from the regulating jurisdictions.

How Online Casinos Fight Back

While the scale of the fraud sounds alarming, it is comforting to know that online casinos don’t sit around waiting for the magical solution — they fight back. There are now elaborate systems in place to catch and prevent the scams. There are even whole businesses dedicating their expertise to monitoring fraud scenarios and building responses to protect members of the gambling industry.

These companies do not rely on patterns like flagging players who deposit big sums of money. Instead, they study behavior and go into deep dives to investigate something that does not look like what an average player would do. A lot of such deep dives lead to uncovering fraud and preventing it.

Some of the real-time data that these companies use is based on IP addresses, device fingerprints, user behavior, and other markers. All of this is used in symbiosis, building an elaborate map of what’s normal and what’s not in player behavior. The result of such a meticulous approach to building a whole system of protection is that a drop in fraud can sometimes be as dramatic as up to 70%.

Companies that make it their mission to protect businesses and players have also learned how to avoid false alarms and not waste resources on pursuing them. The systems are now trained to differentiate a loyal high-roller player from a new user acting suspiciously. This makes life easier for players, improving their experience while also protecting online casinos.

This also costs casinos money, using these services, but the success rate makes additional spending justified. Sadly, not all the online operators are up to speed, and many still get it very wrong when it comes to dealing with fraudsters.

What Do Many Online Casinos Get Very Wrong?

While the international scale of fraud is scandalous, there is still a huge number of online casinos that either turn a blind eye to the issue or decide to deal with it later. Part of the postponing strategy is choosing to rely on outdated fraud prevention systems and approaches. But that’s just existing in denial, as these outdated systems don’t learn and don’t understand complex player behavior. These systems are just a chain of liabilities, leaving online casinos and their players exposed.

Here’s a common example. A gambling site sets a rule: “Manually review all withdrawals over €200.” Sounds safe, right? But what happens next? Loyal players get delays. High rollers get frustrated. And while the staff is busy checking honest players, a fraud ring might be cashing out dozens of small withdrawals that slip under the radar.

Another mistake is treating all players the same. Let’s say a player has been active for three years, never caused trouble, and suddenly wins big. Some sites still freeze the account just to “check for fraud.” That kind of rigid policy doesn’t just waste time — it pushes real customers away.

What the majority of online casinos must come to terms with is the fact that modern fraud prevention systems must be smart and dynamic, not just strict and rigid. The proper way to prevent fraud is to catch a pattern, not get paralyzed by a number, to trust a good player, and to target a real threat instead.

This is a good cautionary tale for us, players, too. Maybe, we are the ones who should hold our gambling platforms accountable by adding some community pressure. If your favorite gambling site keeps delaying your withdrawals, asking for repeated ID checks, or blocking your bonuses without reason, one of the reasons is that they might be using a weak fraud system. And that means more stress for you.

How to Spot Casinos Vulnerable to Scammers

Not all gambling sites play fair. Some are built just to take your money. Others don’t protect you from fraud properly, which can lead to delays, blocked accounts, or even stolen winnings. The good news is, there are warning signs, and you don’t need to be a security expert to spot them.

Let’s go through the biggest red flags.

• No Valid License Information: A trustworthy online operator always displays its license at the bottom of the homepage. You’ll see names like the Malta Gaming Authority (MGA), the UK Gambling Commission, or Curaçao eGaming. If the site doesn’t list anything — or shows a made-up logo — pay attention. You can even double-check license numbers on official websites.
• Poorly Written Terms and Conditions: If the rules about bonuses, withdrawals, or account limits are hard to understand, that’s not by accident. Reliable online lobbies invest in clear rules. If something sounds too strict or unclear, pay attention and ask a question.
• No Real Customer Support: Open the site’s live chat (if it’s available) or send a message to support. If no one replies within a day, or the reply is copy-paste nonsense, that tells you a lot. A trustworthy gambling site invests in helping its players.
• Bad Reputation Online: Search the platform’s name with the word “scam” or “reviews.” If players are complaining about blocked accounts, withheld winnings, or rigged games, take it seriously. Real complaints don’t lie — the gambling community is very proactive when it comes to exchanging questionable experiences.
• Unusual Verification Requests: KYC (Know Your Customer) is normal. But if a site keeps asking you for more and more documents after you win money, it might be trying to stall or block your payout. Once again, this is not a 100% rule, but it might be a good idea to investigate a site’s cashout process further.

If you notice two or more of these warning signs, it’s safer to skip that platform. Stick to well-known operators that care about player safety. You’re not just protecting your money — you’re making sure your time and trust don’t go to waste.

Final Thoughts: Pay Attention to Details

Online gambling is supposed to be fun. It’s about enjoying the games and maybe walking away with a win. But fraud can dampen the mood of even the most casual players. Scammers aren’t just hurting the big companies — they’re messing with your experience, your bonuses, and your ability to rely on the system.

You don’t need to be a tech expert to protect yourself. Stick to licensed sites that use modern fraud tools. Don’t reuse passwords. Avoid suspicious bonus offers from unknown platforms. And if something feels off (like sudden ID checks, strange login alerts, or payouts taking forever), ask questions or take your money elsewhere.

Remember, the best platforms that follow the latest gambling trends are building smarter defenses. They use real-time data and adaptive rules to stay ahead of the fraudsters. When they do that well, everyone wins (except the scammers).

Fraud in online gambling isn’t going away. But if players stay alert and platforms stay smart, the odds shift back in our favor.