2020 i gaming report webinar
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Join iovation in partnership with Clarion Events, for our iGaming Report Highlights Webinar, featuring product expert Angie White. She will review key takeaways from the 2020 iGaming industry report, forecast how these trends will impact both gambling operators and platform providers and answer all of your related questions. Key topics: Top iGaming industry trends and market threats Growth in bonus abuse and other game abuses Optimizing compliance Winning in a mobile-first market Expediting player onboarding
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2020 i gaming report webinar
- 1. Angie White, Product Marketing Manager February 2020 Insights Into Online Gambling Fraud and Building Player Trust 2020 iGaming Report Highlights
- 2. © iovation. All RightsReserved 2 Gambling Last 12 months Percentage of transactions coming from mobile 79% Volume of gambling transactions 483 million Number of risky transactions stopped 49 million Reputation reports submitted by analysts 927,000 100+ Active Gambling Operators & Platform Providers Use iovation © iovation. All Rights Reserved 2
- 3. 3© iovation. All RightsReserved Trust is the New Currency in iGaming Critical to attract new players, but bonus programs are under attack Need to expedite player onboarding Threats and abuses that undermine profitability Secure the Player Journey, SecureYour Long-TermProfitability Effectively managing player self-exclusion Stopping fraud rings and money laundering operations Meeting PSD2 requirements ImproveCustomer Experience,Comply withRegulations The rise of mobile in iGaming Threats to winning in the mobile market Balancing security and building player trust Three Key Market Drivers in iGaming
- 4. © iovation. All RightsReserved 4 Trust is the New Currency in iGaming
- 5. © iovation. All RightsReserved 5 Trust is the New Currency in iGaming 88% of online consumers indicated that they are less likely to return to a site after a bad experience 57% said they would not recommend a business with a poorly designed mobile website *Source: https://www.sweor.com/firstimpressions
- 6. © iovation. All RightsReserved 6 Rise of Mobile in iGaming Mobile-first, player-first
- 7. © iovation. All RightsReserved 7 Consumer Insights Survey 1,604 consumers surveyed • 802 United Kingdom • 802 United States
- 8. 8© iovation. All RightsReserved concerned about the security of their information concerned about greater risk of fraud concerned about the slowness or hassle of filling in data on mobile phones
- 9. © iovation. All RightsReserved 9 Rise of Mobile in iGaming Mobile-first, player-first 63% In Mobile Fraud in the Past Year
- 10. 10© iovation. All RightsReserved Balancing Security and Building Player Trust consumers surveyed stated they have closed an account due to security and fraud concerns 2 out of 5 consumers surveyed would switch companies for one with more advanced security protocols in place 2 out of 3
- 11. © iovation. All RightsReserved 11 Answering security questions was the preferred method for: • 44% of consumers aged 55-74 • 39% of lower income consumers Biometrics was the preferred method for: • 35% of consumers ages 18-34 • 36% of high income earners ($100K+) Consumers aged 35-54 split in their preferences: • 32% prefer security questions • 31% prefer biometrics Balancing Security and Building Player Trust
- 12. © iovation. All RightsReserved 12 Secure the Player Journey, Secure Your Long-Term Profitability
- 13. © iovation. All RightsReserved 13 Secure the Player Journey Improved Login Reduced Friction Expedited Onboarding Added Risk Insights Increased Assurance
- 14. © iovation. All RightsReserved 14 Expedite Onboarding to Grow New Accounts 87% of consumers agreed that brands need to put more effort into providing a seamless experience 90% said they expect consistent interactions across all channels *Source: F25 Amazing Omnichannel Statistics Every Marketer Should Know
- 15. © iovation. All RightsReserved 15 Attract New Players, Not Fraud Rising bonus abuse 72% Increase in the past year
- 16. © iovation. All RightsReserved 16 Credit Card Fraud Growth in iGaming 37% Increase in the past year
- 17. © iovation. All RightsReserved 17 Advanced Machine Learning A Layered Approach to Protecting Player Accounts Human Intelligence Device Intelligence • Suspicious velocities • Geolocation mismatch • Past history of abuse • Blacklisting of devices • Identify trustworthy players • Speed onboarding of players
- 18. © iovation. All RightsReserved 18 Improve the Customer Experience While Complying with Regulations
- 19. © iovation. All RightsReserved 19 Complying with Regulations Affordability Checks Responsible Gambling Age Verification* Identity Verification Anti-Money Laundering (AML) Geo- Compliance *Solution not available in all markets
- 20. 20© iovation. All RightsReserved In the UK, operators paid a record £19.6m in penalties in 2018 for failing to protect problem gamblers and stop money laundering Two fines have already been levied against operators in New Jersey for not properly enforcing player self-exclusion Responsible Gambling Mandates £19.6 Million
- 21. © iovation. All RightsReserved 21 Protect Players and Your Business Social responsibility and player self-exclusion 3 Million Devices 1.2 Million Accounts 363,000 Reports Associated with player self-exclusion Self-exclusion placed by operators in 2019 Associated with player self-exclusion
- 22. 22© iovation. All RightsReserved AML Fines on the Rise Globally In AML fines were levied from January to August of 2019 Three AML fines were levied against iGaming operators in the U.K., the highest being $7.2 million $8.07 Billion
- 23. © iovation. All RightsReserved 23 AbnormalNormal Fraud Ring AML - Unmask Criminal Behavior GOOD ACCOUNTSBAD ACCOUNTS DEVICESREVIEW
- 24. © iovation. All RightsReserved 24 Geo-Compliance Protect against detectionevasion IP or ISP Mismatch Anonymizing Proxies Geolocation Mismatch Is there a mismatch between the real and stated IP? With the ISP? Is there a mismatch between the time zone and geolocation of the device? Is the device evading detection? Perhaps using a VM, proxy or Tor? 119% higher in the U.S.
- 25. © iovation. All RightsReserved 25 TX VT ME NH IDWA WI AK MT MAND MN IL MI NY WY NV SD RI IA IN OH PA NJ CTOR CO UT NE MO KY WV VA MD DECA AZ NM KS AR TN NC SC DC HI OK LA MS AL GA FL Use Your App to Enable Accurate Geo-Compliance
- 26. © iovation. All RightsReserved 26 TX VT ME NH IDWA WI AK MT MAND MN IL MI NY WY NV SD RI IA IN OH PA NJ CTOR CO UT NE MO KY WV VA MD DECA AZ NM KS AR TN NC SC DC HI OK LA MS AL GA FL Use Your App to Enable Accurate Geo-Compliance
- 27. © iovation. All RightsReserved 27 TX VT ME NH IDWA WI AK MT MAND MN IL MI NY WY NV SD RI IA IN OH PA NJ CTOR CO UT NE MO KY WV VA MD DECA AZ NM KS AR TN NC SC DC HI OK LA MS AL GA FL Use Your App to Enable Accurate Geo-Compliance
- 28. © iovation. All RightsReserved 28 Expose & Stop: New Account Creation Bonus Abuse Self-Exclusion Stolen Identity Age Verification* Account Takeover Manage Self-Exclusion Customer Friction Login TriggersFF Deposit Change Account Details Place Bet © iovation. All Rights Reserved 28 Optimized Gambling Player’s Journey Payment Fraud Money Laundering Account Takeover WithdrawalFraud Collusion SyndicateBetting Cheating Cash Out / / Device Intelligence with Machine Learning Device-Based Consumer Authentication Mobile Multifactor Consumer Authentication *Solution not available in all markets
- 29. 29 Reward Good Players Streamline Player Onboarding Grow Market Share Grow Revenue Build Brand Loyalty
- 30. 30© iovation. All RightsReserved Read the full report to learn more gambling.iovation.com/2020- report
- 31. 31© iovation. All RightsReserved Q&A
Editor's Notes
- 2019
- We’ve uncovered 3 market drivers in financial services. Trust is a differentiator Fraud is going mobile Financial services must invest in digital We’ll begin by hearing from the 1,604 consumers we surveyed across the US & UK.
- Consumers aren’t the only ones who prefer mobile devices. Fraudsters are using mobile platforms in ever increasing numbers and fraud controls don’t always match the more mature countermeasures put in place for traditional PCs. Fraudsters are forever adapting their techniques trying to stay ahead of countermeasures and it is tough for financial services companies to keep up. In the 2018 Fraud Detection and ID Verification in Financial Services report with Forrester Consulting, TransUnion found that 70% of providers agree that fraudsters are one step ahead, constantly refining their techniques.
- We’ve seen significant growth in fraudulent transactions originating from mobile devices across all industries we work with, reaching 49% in 2019. This is a big jump from 2018 when iovation saw only 30% of risky transactions originating from mobile, a year over year increase of 63%.
- Between September 17th and 22nd, 2019, iovation, a TransUnion Company, collaborated with Insights West to survey 802 consumers from the United Kingdom and 802 consumers from the United States. The survey focused on their behavior related to online usage of financial services products. Questions focused on the awareness of fraud techniques and their overall trust in financial services providers to keep their information protected and secure.
- Consumers are growing more concerned about the privacy and security of their personal data, which has been amplified by new privacy regulations such as the GDPR and the CCPA. These concerns were echoed in a recent survey we conducted with over 1,600 consumers from the U.S. and the U.K.2 When asked about the reasons for not opening online accounts using a mobile phone, 65% responded that concern about the security of their information was a factor, with 42% of those indicating it was a major factor. Respondents indicated the following factored into not opening an online account using a mobile phone:
- We’ve seen significant growth in fraudulent transactions originating from mobile devices across all industries we work with, reaching 49% in 2019. This is a big jump from 2018 when iovation saw only 30% of risky transactions originating from mobile, a year over year increase of 63%.
- Of the 1,604 consumers interviewed, 3 out of 4 reported that the most important factor when choosing a financial services account is that it keeps their information secure and private. Privacy, security and trust are the most important criteria when choosing a financial institution. Although consumers have a high level of trust in their financial institutions, when security and fraud demands are not met, they are willing to take action and switch institutions.
- In this webinar, we’ll discuss the results of our analysis of 5.9 billion financial services transactions protected by iovation. Surveys with 1,604 consumers in the U.S. and the U.K. Focus on consumers’ perceptions and buying decisions when selecting a financial services company. This blog post will highlight some of the key findings we found in our report.
- Consumers aren’t the only ones who prefer mobile devices. Fraudsters are using mobile platforms in ever increasing numbers and fraud controls don’t always match the more mature countermeasures put in place for traditional PCs. Fraudsters are forever adapting their techniques trying to stay ahead of countermeasures and it is tough for financial services companies to keep up. In the 2018 Fraud Detection and ID Verification in Financial Services report with Forrester Consulting, TransUnion found that 70% of providers agree that fraudsters are one step ahead, constantly refining their techniques.
- At iovation we believe in a layered approach to Fraud Prevention, Defense in depth if you will. FraudForce has provided the first two layers of Device Intelligence and has provided a powered rules based engine to act on human intelligence. SureScore provides the last layer of advanced machine learning which will allow you to maximize your fraud protection and customer experience.
- These solutions go hand in hand
- In 2018 we saw the U.K. Gambling Commission impose numerous multi-million pound fines on operators for ‘fair gaming’ violations. Of particular concern is managing player self-exclusion (PSE). When players self-exclude on a gambling site that uses iovation, that operator submits a self-exclusion report on that account. We have seen a marked increase in the number of reports from operators in the last 2 years, increasing 73% since 2016. Managing and preventing self-excluded players from creating new accounts and attempting to use your service requires collaboration across the industry. During 2018, over 795,000 devices and nearly a million accounts associated with a self exclusion report attempted to access one or more of the digital properties in our network of iGaming clients — more than four times the number of self-exclusion reports placed in 2018. Even with national databases such as GamStop, being able to associate self-exclusion with multiple devices and accounts, across operators, is a key tool in managing this problem.
- AML These device associations reveal a lot about both good and bad consumers Device intelligence is crucial in preventing money laundering. By looking at device and account associations, you can uncover otherwise hidden connections. Associate groups of devices that are related to one another by looking at common account access.
- iovation recently analyzed over half a billion online transactions from our global gambling customers from March 2018 to March 2019 and found that U.S. consumers are trying to bypass system controls to gamble online at a much higher rate than those outside of the use. In our analysis, we saw that 4.13% of online gambling transactions from the U.S., predominantly to European gambling operators, used evasion techniques such as trying to hide their location -- 119% higher than the 1.89% of online gambling transactions from outside of the U.S. which used evasion techniques.
- Geo Compliance For operators launching apps or online betting in new markets, one of the key regulatory constraints is controlling play based on geographical boundaries without degrading the player experience. Emerging technologies are making these processes much more seamless to manage, right in your native application. Geofencing can be enabled as an authentication constraint directly through your mobile app so that players can place bets in Nevada, for example, but are restricted from betting as soon as they cross the border into Utah.
- Geo Compliance For operators launching apps or online betting in new markets, one of the key regulatory constraints is controlling play based on geographical boundaries without degrading the player experience. Emerging technologies are making these processes much more seamless to manage, right in your native application. Geofencing can be enabled as an authentication constraint directly through your mobile app so that players can place bets in Nevada, for example, but are restricted from betting as soon as they cross the border into Utah.
- Geo Compliance For operators launching apps or online betting in new markets, one of the key regulatory constraints is controlling play based on geographical boundaries without degrading the player experience. Emerging technologies are making these processes much more seamless to manage, right in your native application. Geofencing can be enabled as an authentication constraint directly through your mobile app so that players can place bets in Nevada, for example, but are restricted from betting as soon as they cross the border into Utah.
- Let’s look at this through the lens of an Online Gambling Operator securing the player journey. One of the major problems Operators run into at New account creation is promotions abuse. For example, they may offer a $100 promotion to all new players who setup an account. Fraudsters will try to game the system by setting up multiple accounts, taking advantage of the promotion. By integrating FraudForce at login these promo abuses can be caught either through velocity rules or reputation reports that detail the fraud history. iovation is also uniquely suited to help manage self excluded players that might try to setup new accounts. We track self excluded players by device and associations between devices, rather than by the account. So If players attempt to return with a known device, we recognize it before they can play. This prevents future fraudulent self-exclusion claims. Implementing ClearKey at login is a very effective way to stop account takeover without adding customer friction. Players pair their devices to the Operators service and then at subsequent logins ClearKey will check the device pairing, and assess risk factors indicative of ATO. If no risk is detected players are automatically authenticated. All of this is done in the background, creating a frictionless player experience, while providing a higher level of assurance for the Operator. Deposit is a another high-risk transaction point for online gambling, because fraudsters will use stolen credit cards to make deposits and then play with that money. Not only will the Operator be out the money for the deposit but also any winnings. Also, many cybercriminals will also try to use gambling services to launder money. Our global network of fraud analysts collaborate to fight these types of fraud by reporting when fraudulent activity has been confirmed. When the same device, or even associated devices reappear in our network, we report its past history of fraud. In addition, our ability to identify high transaction velocities for devices or IP address is effective in fighting these types of fraud. Operators are continually working to stop cheating, collusion and chip dumping during play. With iovation they can flag devices by specific types of past cheating behavior. We then inform them if the device in use is associated with devices or accounts that have a history of cheating or fraud. Another high-risk touchpoint is cash out, where a player withdraws any winnings. Here the Operator can add multiple layers of validation. If risk signals are detected LaunchKey can be deployed to provide step-up authentication. The Issuer could also utilize the patented authorization capabilities of LaunchKey. Pushing an authorization request to the players device, with a notification along the lines of ‘Do you authorize cash out of $10,000?’, they could the authenticate with a thumbprint, for example or deny the transaction if they didn’t initiate it.