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8 September, 2021

The Importance of Anti-Fraud & Money Laundering In Your iGaming Technology

The rise of the iGaming industry in recent years has been accompanied with an increasing number of jurisdictions across the globe creating regulatory bodies and rules for the industry. While the rules can vary from country to country, one of the universal guidelines iGaming operators must adhere to is having a system to protect against money laundering. Additionally, the rise of iGaming has led to increasing competition amongst iGaming operators, where many offer lucrative bonuses to new bettors, which if not administered properly are prone to abuse by fraudsters. This is where anti-fraud iGaming technology can set you up for success.

This article highlights the importance of anti-fraud iGaming technology and having payment processing that includes KYC (know-your-customer) and is AML (anti-money laundering) compliant. As a licensed operator, it is your duty to ensure that both AML and KYC features are present in your online casino or sportsbook. If you are interested in learning more about the steps involved in being a legally compliant iGaming operator, email us at hello@liongaming.io to learn how we can help you secure a gaming license!

Let’s get started by addressing some common concerns you might have about this topic.

Having KYC/AML will reduce the number of players my business will attract

This is a common myth amongst some iGaming operators. While it is true that some potential players may not feel comfortable sharing their personal information, the majority of players prefer to bet with sportsbooks that are compliant with the law:

“Research suggests that sports bettors “overwhelmingly” prefer legal operators, with 74% of respondents stating they believe it was important to only place wagers with a regulated bookmaker.”

American Gaming Association

If your online casino or sportsbook is not compliant with KYC/AML regulations you not only risk penalties from the authorities in their respective jurisdictions, but also risk losing out on potential players.

This concern is also frequently voiced among crypto casinos who want to attract players that prefer gambling in cryptocurrency. Some operators have the misconception that since crypto is supposed to be anonymous, crypto bettors won’t want to play on websites that require them to go through KYC procedures. However, what crypto bettors truly want is to be assured that they will receive payouts and that the games they are playing aren’t unfairly rigged against them. Keeping their crypto safe and not being victim to online casinos or sportsbooks who would unfairly take their crypto is a top concern for these players. If you are a licensed operator who requires KYC for all of your players, crypto bettors will appreciate the fact that a reputable authority is licensing the online casino and will be more likely to play using your online casino instead of one that doesn’t require KYC and is unlicensed.

In addition, even the most popular crypto casinos such as Stake require their players to go through KYC processes. The popularity of Stake among crypto gamblers alone should dispel the myth that KYC will reduce the number of players your online casino or sportsbook can attract.

Implementing KYC & AML procedures will be a hassle for the user experience

This concern is somewhat similar to the one mentioned above, however you should rest easy knowing that all of the world’s largest iGaming operators have KYC/AML baked into their technology suite. Moreover, for bettors using fiat currency, no additional steps are required from them when funding their accounts thanks to integrated KYC/AML in most payment processors.

Plus, the KYC process these days is simple and fast. With Lion Gaming’s solutions, powered by the Fer0x Engine, players can go through KYC procedures and get verified in just a few minutes. Years ago KYC took days and even weeks to conduct, but nowadays the user experience for going through KYC procedures is hassle-free.

Besides regulatory reasons, why else is anti-fraud iGaming & KYC technology important?

Knowing your customer is not just important for maintaining good standing with regulatory authorities, but also crucial to your bottom line by preventing fraud and abuse of bonus programs.

Most iGaming operators offer affiliate programs and bonuses that could be abused through the creation of multiple accounts. For example, if a casino offers a signup bonus consisting of a $50 risk-free bet, in addition to an affiliate program that pays 10% of the house edge, a bettor may be enticed to create two accounts to game the system. If an operator uses anti-fraud technology, they are able to prevent this scenario from occurring.

Is KYC and anti-fraud iGaming technology expensive?

KYC is one of the cheapest components in the player acquisition journey. Many payment processors include it in their processing fee, while others charge a small fee (typically a dollar or two) per user. The savings from reductions in fraud alone more than makeup for the marginal costs of implementing this KYC technology.

Thanks for diving into the world of KYC in online gaming with us! As you’ve discovered, it’s not just a regulatory checkbox – it’s a crucial player in ensuring a secure and trustworthy gaming environment.

Curious to explore the KYC providers integrated in Lion Gaming’s Fer0x Casino and Fer0x Sportsbook solutions? Contact us today to explore our innovative iGaming solutions.

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VP of Operations
c.lewis@liongaming.io

Christine Lewis

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      Lion Gaming Group Inc.
      855 2 St SW #3500
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      T2P 4K1 Canada
      Our address
      Lion Gaming Group Inc.
      855 2 St SW #3500
      Calgary, AB
      T2P 4K1 Canada
      Our address
      Lion Gaming Group Inc.
      855 2 St SW #3500
      Calgary, AB
      T2P 4K1 Canada