How to Set Up an AML Compliance Program

by Florian Tanant
Have you ever signed up for a service with different accounts? You might have, without noticing, broken their terms and conditions by performing what is known as multi accounting.
Of course, it doesn’t make you a fraudster but those who purposefully create multiple accounts to abuse a system are crossing a fine line between customer benefits and company damage.
At its core, multi accounting means opening more than one account per person but there are both sophisticated methods and simple ones.
A basic level of multi accounting would be a user create an account with an email address and password, log out of said account then create another one. This is often seen with the same device or by the same IP, or even potentially through a VPN, but with certain solutions such as device fingerprinting, this can easily be detected.
More sophisticated cases would see organized fraudsters use emulators, virtual machines, and even residential-like IPs, such as SOCKS5 proxies or mobile networks to leverage fresh IP addresses. This is also referred to as gnoming.
Furthermore, they could use stolen data or synthetic identities, or IDs constructed based on a real original document to fool the operator in thinking they are a real user.
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Multi accounting creates different problems depending on the site platform or service it is targeted at as it can lead to both abuse and reputational damages. The most common reasons it’s used are:
But there’s more; below we’ll look at some examples of multi accounting that are specific to different verticals.
The following industries are the most affected when it comes to multi accounting scams:
In the eCommerce industry, companies have to deal with multi-account payment fraud and promo abuse as fraudsters look to hit merchants with chargebacks as well as spam discount codes/offers at scale.
Online loan providers have to battle fraudsters who use multi accounting to default on the loan and run away with the money. Similarly, financial institutions have to stop fraudsters from gaining access to promos or payment methods for fraudulent purposes.
In the social media and online dating world, users will create multiple accounts to reach more people – often to scam or spam users.
The travel industry is also increasingly targeted and now must battle the problem of fake bookings and reviews from scammers – and even from malicious competitors who can try to damage other businesses’ reputations.
The Gaming or iGaming industry has its own term for multi accounting: smurfing. The method is the same, and the goal allegedly more innocent. It is simply for gamers to improve their tactics without damaging the statistics of their main account.
Finally, the Online Gambling Vertical is one that’s hit particularly hard as it’s susceptible to a number of attack vectors such as:
To prevent multi accounting you would immediately think to simply increase the difficulty for players to create multiple accounts by implementing more steps to the account creation process.
However, not only does this add more friction to your user experience but also in a webinar we hosted for the gambling industry, a poll revealed that finding connections between different accounts was the number one challenge for fraud managers.
It’s important to combine all the analyzed data and process it through intelligent rules, while fraud managers can spot connections manually, they can’t do it at scale.
This is why AI-powered rules, velocity rules, and behavior profiling are the only effective solutions to filter out the noise and reveal accurate insights to determine if multiple accounts do indeed belong to the same person.
Our solution includes combining the following tools to create a four-pronged line of defense that we believe is vital to mitigate the risk of multi accounting:
In short, it’s about using a system that leverages AI and human intelligence to process incredibly large amounts of data, and validate the recommendations thanks to human wisdom and insight.
See a basic walkthrough below of how SEON catches multi-accounting abuse, based on custom rules.
Multi accounting is a growing problem for almost any kind of business operating online. It can be simple or complex, and innocent or done on a scale only an organized crime ring can reach.
However, tools such as IP and Device fingerprinting, email analysis, and AI-driven algorithms are strong weapons to have in your arsenal against fraud.
And while not all multi accounting should necessarily be seen as fraudulent, you can still implement the right tools to let your team decide if it must be stopped or not.
More importantly, if a customer seems suspicious based on the digital footprint, you should have enough flexibility to add or remove dynamic verification steps. All so you can reduce conversion churn, friction, and simplify the user journey for delivering the best experience possible.
There are multiple options to detect multi accounting which you can layer up, some include: cookies, local storage, geolocation and IP address information, device fingerprinting. Try a free demo with us today and see for yourself.
Any industry that offers some form of sign up bonus is likely to be a target of multi accounting as well as websites that might ban / blacklist users due to cheating or illegal activities.
Technically the act itself is not illegal, unless using another REAL persons identity, however many businesses will state that multi accounting is a direct violation of their terms and conditions.
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Data Enrichment | Browser Fingerprinting | Fraud Detection API | Fraud Detection with Machine Learning & AI | Best Fraud Detection Software
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Communication Specialist | Florian helps tech startups and global leaders organise their thoughts, find their voices, and connect with customers worldwide.
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