iGaming Affiliate Fraud: How to Detect, Prevent & Stop it in 2024?

iGaming affiliate fraud can be a huge problem for iGaming businesses. It not only leads to financial losses, but also damages your credibility and reputation. Therefore, it is vital to recognize the first signs of affiliate fraud and take measures to prevent it in the future.

In this blog post, we will look at the different types of iGaming affiliate fraud and how they can be identified.

We will also explore some key strategies to prevent fraud from affecting your business in the first place. With the tips outlined here, you can ensure your business remains secure from malicious activities.

We’ll start by discussing the different types of iGaming partner fraud and how to detect them. 

So let’s get started!

Top 10 iGaming Affiliate Fraud Treats and Solutions

Here is a simple cheatsheet to get you started:

Threat	How to Detect?	How to Prevent?
Fake Traffic	Monitor traffic spikes & irregular patterns	Set thresholds for suspicious activity; block IPs
Cookie Stuffing	Track cookie origin and lifespan	Use first-party cookies; monitor for bulk cookie drops
Proxy Users	Geo-IP analysis; velocity checks	IP blacklists; multi-factor authentication
Stolen Credit Card Transactions	Watch for multiple small deposits	Use AI for iGaming fraud detection; two-step verification
Identity Theft	Unusual changes in user behavior, malicious behavior detection	Strong passwords; security questions
Ad Stacking	Check ad viewability metrics	Use ad verification services; penalize violators
Click Spamming	Analyze click-to-install time	Set time thresholds; use anti-spam tech
Fake Accounts	Monitor for duplicate emails, IPs	CAPTCHA; email and SMS verification
Commission Evasion	Track inconsistencies between clicks and conversions	Implement secure tracking solutions
Software Fraud (bots, malware)	Monitor for non-human interactions	Anti-bot measures; regularly update security protocols

Now, let’s get deeper into this complicated and dangerous field.

Understanding iGaming Fraud

You may have heard of iGaming fraud, but do you actually know what it is and how to detect it? 

In the simplest terms, iGaming scam is a type of malicious behavior that takes advantage of referral programs and incentives from online gaming websites.

In iGaming, fraud occurs when unscrupulous players or affiliates attempt to game the system for personal gain. This can take many forms, including creating multiple accounts with different manipulation techniques, using malicious software or scripts to alter game outcomes, or engaging in fraudulent activities such as deceiving customers or withholding the payment of winnings.

There are a number of signs that you can watch out for that will help you detect fraud in iGaming. These include unusually large payouts to certain players, suspicious account activity such as multiple users tied to one account or the creation of fake accounts, and an overwhelming amount of traffic from one area.

Keeping tabs on these indicators is crucial if you want to stay ahead of the curve and minimize losses should the need arise.

The Different Types of Affiliate Fraud

It’s not pleasant to think about, but preventing fraud is necessary in iGaming affiliate marketing. By knowing what kinds there are and how to identify them, you can take steps towards stopping it in its tracks. Here are a few common types:

• Bonus Abuse: This scam occurs when players take advantage of promotional offers to make a profit. The fraudster will use multiple accounts, often with false information, to gain bonuses or cash rewards intended for first-time players.
• Commission Theft: This involves stealing commission from other affiliates by altering tracking codes or using other fraudulent methods.
• Cookie Stuffing: This is a fancy way of referring to inserting affiliate tracking cookies onto a user’s device without their knowledge. This can result in the affiliate receiving commissions for sales that were not generated through their own efforts.
• Incentivized Traffic: In this case, the affiliate will attempt to generate traffic by offering rewards for visiting their website, downloading their app, or signing up for their product. This incentive scheme can create artificial demand or artificially high numbers on a website’s analytics.
• Payment Fraud: This involves the fraudulent use of someone else’s credit card or payment processing system. Affiliates must use secure payment systems with established protocols to verify transactions and guard against payment fraud.
• Affiliate Hijacking: This is when an affiliate alters the tracking code of another affiliate to receive a commission for sales that they did not actually generate.
• Fake Sales: This means creating fake sales through fake identities, fake credit card information, or other fraudulent methods.
• Click Fraud: This is a popular way of scamming by generating fake clicks on affiliate links to artificially inflate earnings.

No matter what type of iGaming affiliate program you are running, it’s important to be aware of potential signs and symptoms of affiliate fraud so that you can identify any suspicious activity quickly and take appropriate action.

How to Identify Fraudulent Traffic?

Affiliate marketing for gambling can be like the Wild West—profitable but filled with bandits. Fraudulent traffic is more common than you think, but here are a few key indicators that will help you spot fraud before it bleeds your campaigns dry:

• Unusual User Behavior
  Always be on the lookout for unusual behavior patterns. If users are only visiting specific pages or continuously bouncing between multiple computers and/or user profiles to access games, it’s a red flag. Real users aren’t typically that predictable. They explore, navigate, and use various features. Fraudsters, on the other hand, are more precise—they’re after specific commissions, often leaving behind patterns in their limited browsing habits.
• High Number of Brand Searches
  See an unusually high number of brand searches popping up in a short period? It’s not a PR breakthrough—this is more likely fraudsters trying to dissect your program to figure out how they can exploit it. Be especially mindful if these searches come with a lack of other brand-related engagement. Fraudsters aren’t interested in your stellar content or community-building efforts; they’re laser-focused on finding loopholes.
• Very High Conversion Rates
  Conversion rates that are abnormally high or consistently outperform benchmarks are rarely a good thing. If it’s too good to be true, guess what—it probably is. Fraudsters often use incentive-driven methods to inflate conversion rates. Whether it’s bonus hunters or manufactured leads, these aren’t the conversions that are going to generate long-term revenue for your business. Monitoring affiliate campaign performance and identifying discrepancies is crucial here.
• Inconsistent Numbers
  Nothing catches fraud like looking at historical data. Sudden spikes in activity from certain countries or IP addresses that don’t correlate with your usual customer base are big indicators of fraudulent behavior. Affiliates playing by the rules typically generate consistent traffic from their target audience, while fraudsters tend to work in bursts, exploiting the system when they think no one is looking.
• Unusually High Affiliate Earnings
  Let’s talk numbers: high earnings for affiliates are great, but not if they’re suspiciously out of line with historical performance or correlated traffic. If an affiliate’s earnings suddenly spike without an obvious corresponding increase in legitimate traffic, you may be looking at someone exploiting incentives or finding a way to milk the program that doesn’t involve legitimate customer conversions.

Investigating Suspicious Traffic

When any of these red flags pop up, it’s time to dig deeper. Go beyond the surface by checking IP addresses, geolocations, and user-agent data linked to the suspicious activities. Matching that against historical data often reveals inconsistencies that point to fraudulent traffic. Whether it’s repeated IPs accessing multiple accounts or irregular browsing devices, a deep dive will often reveal fraud’s fingerprints.

Techniques for Tracking Suspicious Activities

The iGaming industry’s explosive growth makes it fertile ground for fraudsters, so staying ahead means employing cutting-edge techniques to root out the bad actors. Let’s explore some of the best methods:

Set Up Fraud Alerts

Prevention is the best cure, and setting up fraud alerts is like having a security guard on watch 24/7. Fraud alerts provide early signs of irregular activity, giving you a chance to catch and react to potentially fraudulent activities before they become major issues. Tools like Anti-Fraud Logic are especially useful for setting up custom alerts—whether it’s unusual clicks, sudden traffic spikes, or erratic conversions, these alerts notify you instantly so you can take action.

Track Your Campaigns Closely

Tracking campaigns shouldn’t be a once-a-week check-in; it’s an everyday job. The moment you take your eyes off the data, fraudsters are ready to exploit the gap. This means keeping an eye on clicks, conversions, and analyzing discrepancies between them. Data doesn’t lie. If your clicks are going up but conversions are stagnant or worse, dropping, you’re probably looking at fraudulent activity. Use real-time reporting tools to keep everything in view—24/7 vigilance.

Utilize Affiliate Tracking Software

This is not the time to skimp on tools—using specialized software like Scaleo is critical for detecting discrepancies. Affiliate tracking software helps by centralizing data and giving you detailed analytics. You’ll be able to detect odd patterns like inconsistent click-to-conversion ratios or sudden changes in traffic quality. These patterns are easy to miss when you’re monitoring data manually, but automated affiliate tracking platforms can instantly notify you of anything suspicious, allowing you to react faster and smarter.

Affiliate Accounts Audit

Auditing affiliate accounts regularly isn’t just a precaution—it’s a necessity, especially in iGaming where affiliates might be providing lifetime services for players. Without audits, you run the risk of missing out on payments or, worse, paying for fake referrals. Here’s how you can make audits work:

• Create an Audit Checklist
  Have a robust checklist of criteria that every affiliate must meet, such as payment verification, account agreement compliance, and engagement tracking.
• Examine Signup Sources
  Dig into the source of each signup and compare it with traffic sources to uncover any suspicious activity. This will help you catch bogus referrals from affiliates gaming the system.
• Player Verification
  It may seem tedious, but contacting players directly can give you an accurate sense of whether they are genuine participants in your program.
• Review Traffic Sources
  Analyzing traffic sources lets you determine if the quality aligns with your standards or if affiliates are funneling traffic through suspicious channels to inflate their earnings.

Regular audits do more than just prevent fraud—they help ensure your affiliate program is being run efficiently, protecting the integrity of your business, and keeping affiliates accountable.

Strategies to Mitigate the Risk of iGaming Fraud

Fraud is real, but it’s also manageable with the right strategies:

Leverage AI and Machine Learning

The most effective fraud prevention today relies on AI and Machine Learning (ML). These technologies are capable of analyzing millions of data points at lightning speed, identifying patterns that may go unnoticed by human analysts. Whether it’s players winning too consistently or irregular payment behaviors, AI can help you detect potential fraud early. By continuously learning from the data, AI tools become even more adept at spotting fraudulent behavior, reducing your risks over time.

IP Fraud Score

Not all IP addresses are created equal. IP Fraud Scores are valuable in assessing whether an IP address is likely linked to fraudulent activity. The fraud score is calculated based on several factors, such as the IP’s historical behavior, its geographical location, and any existing red flags. Fraud scores help you make an informed decision about whether to block or restrict certain users.

The result?

You get to prevent identity theft, phishing attempts, and unauthorized account access—all critical to maintaining a secure gaming environment.

Monitor Traffic Quality

Fraudsters often use low-quality traffic—usually bots or paid click farms—to achieve targets. Monitoring traffic quality, not just quantity, helps differentiate legitimate growth from fraudulent activity. Tools like TrafficGuard can automatically block suspicious traffic sources, thereby saving your budget from being wasted on fake engagement.

Incentivize Honesty

Here’s a counterintuitive thought—if you can’t beat them, outplay them. Offer better rewards for affiliates who have consistently low fraud rates and a history of legitimate leads. This way, you attract serious affiliates and discourage fraud from the get-go. A win-win—great affiliates earn more, and you deal with fewer headaches.

Data Cross-Referencing

Cross-referencing data across various platforms—such as affiliate tracking, Google Analytics, and CRM systems—helps you spot discrepancies that would otherwise go unnoticed. For instance, if affiliate-reported data doesn’t match up with your analytics platform, it’s a good sign something’s off.

Affiliate Fraud Prevention is Ongoing

The battle against iGaming fraud doesn’t have an end—it’s ongoing. Implementing these strategies will not only safeguard your profits but also build trust with genuine affiliates who benefit from a fair playing field. And remember, real-time monitoring, data vigilance, and proactive fraud alerts are your best bet in making sure you stay one step ahead of fraudsters lurking in the shadows.

Here is a screenshot from Scaleo, where you can see how traffic is monitored and rated in real-time, and the IP score tells you if the traffic is legit or not, based on percentages.

Implement KYC Procedures

Knowing Your Customer (KYC) procedures are an effective way to spot fraudulent activities and protect your iGaming business from being taken advantage of.

In addition to verifying customers’ identities, KYC checks also involve monitoring their activity for any suspicious behavior or attempts to abuse bonus offers, payment systems, or other services offered by your company.

Monitor Affiliate Performance

Monitoring affiliate performance metrics is essential in detecting fraud and mitigating risks associated with iGaming affiliates. This includes tracking a range of factors, such as the marketing cost per acquisition, revenue per acquisition, and cost per click, among many others. These metrics will help you identify any affiliates who may be promoting your brand without adhering to your rules or engaging in fraudulent activities.

Implementation of Anti-Fraud Measures

Certain measures need to be implemented to prevent iGaming affiliate fraud. These measures include:

Monitoring Tracking Links

This is one of the best ways to prevent fraud in iGaming affiliates. This means tracking the source of referral traffic and ensuring it is coming from legitimate sources. If any suspicious activity is detected, an investigation can be conducted to determine its source and take appropriate action.

Automated Fraud Detection

Automated iGaming fraud detection tools (such as the aforementioned Anti Fraud Logic) can be used to detect any suspicious activity or anomalous patterns in real-time. This includes monitoring traffic sources, IP addresses, and other user information for any potential irregularities.

Using these tools ensures that any fraud attempts are identified quickly and effectively so that they can be resolved without further financial losses.

KYC Verification

Know Your Customer verification is another important measure in iGaming affiliate fraud prevention. This involves verifying the identity of each customer using a combination of data points such as name, address, email address, phone number, etc., before allowing them access to the platform.

This helps ensure only legitimate customers are allowed access and helps to mitigate any potential fraudulent activities.

Conclusion

It’s essential to safeguard your iGaming business from fraud and dishonest affiliates. To do this, thoroughly review your partner’s API, integrate regular checks in all payments, use proper analytics tools and insights, and proactively tackle unauthorized activities.

Additionally, stay up-to-date with ever-evolving technologies, fraud tactics, and legislation changes. Implementing the tips outlined here can help you detect, prevent and handle iGaming affiliate fraud to ensure the success of your business for many years to come.

Ready to get started with robust affiliate software that will safeguard your affiliate program from spam? Try Scaleo free for 14 days and schedule a demo call with our team, to see what it can do for your business.

Detecting iGaming Affiliate Fraud – FAQs

When it comes to detecting affiliate fraud in the iGaming industry, some questions frequently come up. Here are the answers to some of the most common questions:

Last Updated on October 10, 2024