Multi-Accounting: What Industries are Under Threat and How to Stop It

Businesses often underestimate the consequences of multi-accounting. Let’s find out when it can become an expensive issue and how to prevent it.
Multi-Accounting: What Industries are Under Threat and How to Stop It

Mark saw that his favorite carsharing service is offering lucrative discounts for new customers. He decided to take advantage of this promo by creating another account. Is this a crime?

What Mark did isn’t exactly fraud, but if the service prohibits multi-accounting, he certainly violated the terms and conditions. Similar instances of account misuse can be seen across multiple online industries, such as e-commerce, gambling, betting, gaming, dating, travel, and food delivery.

Multiple account misuse has surged along with other forms of online fraud during the pandemic—when consumers rapidly transitioned online and businesses offered perks to attract them.

What is Multi Accounting?

Multi-accounting is when a single user registers multiple accounts to take advantage of an online service. This can be done to repeatedly benefit from free trials, discount codes, and other bonuses—or to continue using the service after getting banned.

Multiple accounts may seem benign; for instance, people can often have both public and private social media accounts. But when it comes to online services, multi-accounting can be used for a range of fraud activities (which we’ll cover in more detail below). For this reason, companies that detect multiple accounts being created or accessed from a single device should consider this a red flag.

Many companies explicitly prohibit having more than one account, but some users find ways to get around these restrictions. In fact, you can find tips on this practice on forums and Youtube videos, which offer detailed explanations on how to multi-account without getting caught.

Multi-accounting methods

Multi-accounting methods can range from basic to complex:

  • Creating multiple accounts from the same IP address and device using a new email address. This is the simplest method of multi-accounting. Users don’t have to be tech-savvy, but more advanced ones may use a VPN.
  • Gnoming. This is a more complex method used by professional gamblers after getting limited or banned by bookmakers. They create new accounts in other people’s names, usually with the personal data of close friends and family. In more sophisticated cases, gnomers use emulators, virtual machines, and even residential-like IPs to create new accounts.
  • Using fake or stolen identities. The most experienced fraudsters convince KYC operators that they are new customers by using stolen data, fake identities, or IDs forged from original documents.

Find out how FASTCUP, a game matchmaking platform, reduced 75% of multiple accounts using liveness checks.

The purpose of multi-accounting

There are various reasons why people conduct multi-accounting:

  • Promotion abuse. This is when customers take advantage of a business’s discount codes, sign-up offers, and other bonuses.
  • Affiliate fraud. Some services offer referral bonuses if users invite their friends. By creating multiple accounts, users can collect affiliate and initial signup bonuses without actually increasing the customer base of the service.
  • Circumventing limits/bans/blocklists. This is one of the most common reasons why users might create new accounts under a different name—allowing those with bad credit histories, driving records, or gambling bans to continue using particular services. This practice can also involve those with low ratings on peer-to-peer services, such as online marketplaces.
  • Fake customer reviews. Multiple accounts can be used to write numerous false reviews, which affects the integrity of online ratings and ultimately brings down customer trust.
  • Smurfing. This is when a high-level gamer creates a new account to play against lower-ranked players. Skilled players use smurfing to get points or improve their tactics without risking their main account. This results in unbalanced matchmaking, which can ultimately drive away gamers.

All in all, multi-accounting creates different problems depending on the site platform or service targeted.

What businesses are affected?

Any business can become a multi-accounting target, but the following businesses are most likely to suffer:

  • Peer-to-Peer Services

These are decentralized platforms where the buyer and the seller transact directly with each other. People use such platforms to sell things, offer services, and post tasks for qualified professionals. Fraudsters can create multiple accounts to swindle others—for instance, by selling fakes or asking for prepayment and disappearing with the money. If unchecked, these practices can cause the marketplace or service to lose a significant number of honest customers.

  • E-commerce

In recent years, online marketplaces have become ripe targets for promotion abuse and affiliate fraud. This refers to the repeated use of sign-up bonuses, referral bonuses, and vouchers from multiple accounts.

  • Gaming

Multi-accounting has been a huge problem for gaming and gambling platforms since unscrupulous players can enrich themselves by selling accounts and certain resources. For instance, players can sign up on multiple accounts to amass free gifts intended for newcomers and resell them.

  • Betting

Bettors can use multiple accounts in order to conduct arbitrage betting, a practice otherwise known as “arbing.” This refers to a strategy in which bets are placed on multiple outcomes to guarantee a profit. Arbing is legal but bookmakers don’t welcome this practice because it costs them money. However, it’s typically difficult for bookmakers to identify and track arbers.

  • Travel services

In the travel industry, fraudsters use multiple accounts to write fake reviews, which travellers heavily depend on when booking their vacation. Accordingly, a single negative review can be costly for any travel company. Multi-accounting is also used for fake bookings to get onboarding perks. What’s more, there are fake accounts resembling real travel agents.

  • Dating services

The online dating industry is full of romance scammers and fraudsters that use multiple accounts to reach more people. Statistics show that 30% of U.S. adults use dating apps or websites, while romance scams caused $304 million in losses in 2020, underscoring the vulnerability of the industry.

For instance, Simon Leviev, the famous tinder swindler, created several fake identities to date with dozens of women around the world. Then he managed to establish lines of credit and loans in their names, ultimately leaving them holding the bills.

In the aftermath, scammers created plenty of fake ‘Simon Leviev’ accounts as The Tinder Swindler went viral. They make money from fake fundraising campaigns created to allegedly support Leviev’s victims. In other cases, Leviev’s identity has been used to promote legit businesses such as NFTs.

Sumsub offers in-built, AI-powered solutions to keep fraudsters away. Request a demo today.

How to prevent multi-accounting

To mitigate the risk of multiple account misuse, Sumsub offers the following AI-powered solution:

  • Facial authentication (liveness check). This involves biometric analysis of a user’s face and facial movements to ensure true presence during the check.

First, the user goes through the liveness check upon account registration. Then, the system uses the results to determine whether this user already exists in the database. This way, advanced face authentication solutions can help businesses ensure that users are genuine individuals—and not just the same person with an endless number of accounts.

Moreover, the liveness check can be effortlessly integrated with company websites or mobile apps via Web SDK, API, and Mobile SDK.

Plus, users’ facial biometric data will be reliably protected from unauthorized access, since Sumsub’s liveness solution has been proven secure by iBeta tests, performed in accordance with ISO/IEX 30107-1.

To sum up, multi-accounting prevention requires flexible and secure verification—such that honest users are kept satisfied, while fraudsters and bonus hunters are kept out. While not all multi-accounting should be seen as necessarily fraudulent, businesses can still use advanced solutions to decide if it should be stopped or not.

Sumsub works to understand the specifics and pain points of each business and offers tailored fraud detection technology solutions. Give us a try!

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Multi-Accounting: What Industries are Under Threat and How to Stop It

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