TECHNICAL
Authenticating the online
gaming industry
expert at Experian, discusses the
importance of making sure online
gamblers are who they claim to be…
The growth of the Internet has had a major
impact on the gaming sector. Over the last 15 years,
new online gaming companies have emerged, such
as Bet365.com and 888.com. These organisations
have quickly secured an attractive share of the
online gaming market, without the need for a strong
high street presence. Noting this success, traditional
offline bookmakers have ramped up their online
strategies to compete and claim their territory in this
lucrative market.
The challenge for all online gaming operators is to
acquire, and retain, as many customers as possible.
Half of the battle is to attract visitors to their website;
the other half is to quickly convert those visitors into
customers. Potential customers must complete the
registration process and pass all of the compliance
or ‘Know Your Customer’ (KYC) checks before they
can even begin to gamble. If the sign up process is
too difficult or time consuming, these customers are
only a few clicks away from a competitor’s site.
Compliance checks include confirming the
customer’s age, identity, location and source of
funds, as set out in the Gambling Act 2005 and
Third Anti-Money Laundering Directive (2007).
The main objective of these checks is to prevent
underage gambling, money laundering and fraud.
As online gaming is not face to face, operators must
verify individuals without any visual contact.
Remote identity authentication
The majority of online gaming companies now use
electronic authentication – a combination of data
and technology – to ensure security and confidence
in their client base. But these solutions can be either
a help or a hindrance to customer acquisition,
depending on the volume and quality of data they
use. If a customer can’t be found on the system and
verified instantly, then they can’t be signed up and
must be passed into a referral process, which is often
manual and time consuming.
Electronic authentication verifies an individual’s
identity using data sources such as the Electoral Roll,
a database of registered voters in the UK, and public
information files. In the more robust solutions, this
data is then supplemented with up to date, nonfinancial data from credit reference agencies, fraud
intelligence and risk scoring.
The individual’s biographical data, such as
name, address, previous address and date of birth,
is compared against the multiple databases. The
information can also be screened against sanctions
data to check that the individual is not a politically
exposed person or has a known history of money
laundering. This means there is no need for two
separate business processes to confirm identity and
screen for money laundering.
The results should provide a confidence level that
the individual exists in society; the person applying
is actually that individual; and the risk factors
associated in doing business with them.
Another consideration is whether the technology
can withstand peak trading conditions. Events
such as the Grand National and FA Cup mean
that huge volumes of customers may visit the site
on a single day. Technology that can’t cope with
these multiple, simultaneous transactions, may
experience downtime and lead to revenue losses for
the business.
they say they are and b) that they are not underage or
looking to commit fraud? This insight should enable
the organisation to automatically restrict access
depending on the risk of doing business with that
individual.
From a compliance perspective, an electronic
audit trail of all customers that have been processed
through the system should be provided to enable
online gambling providers to satisfy regulators’
demands.
Satisfying commercial
and compliance needs
Electronic authentication should not only help
organisations to isolate underage gamblers, but
should also mean that safe and genuine customers
are seamlessly and quickly authenticated with
minimum effort on their part.
Technology is now sufficiently advanced to ensure
that identity authentication systems can be put in
place that satisfy both commercial and compliance
needs. Front-end authentication processes are now
being linked to ever more sophisticated backoffice fraud detection systems and data sharing
programmes. This approach will ultimately ensure
that the industry is able to successfully combat
underage gambling and online fraud.
And ultimately, effectively collecting and verifying
customer details will help organisations build an
accurate customer database. The benefits of this
will be reaped long after the customer acquisition
process, as good data is the foundation for strong
ongoing customer relationships. ■
More data, more customers
As mentioned before, the success factor for electronic
authentication is the accuracy of the information
that the assessment is based on. The more data that
is held by the data provider, the more likely a positive
ID or ‘match’ will be generated. This supports what
is known as a risk-based approach. With what level
of certainty can you say that a) the person is who
AUTHORPROFILE
Ahmed Amin, identity management
Ahmed Amin. Having worked
with Experian since 2005,
Ahmed Amin has spent the last
three years advising gaming
operators, such as William Hill,
Rank Group and Grosvenor
Casinos, on their identity management
strategies.
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