Online Poker Payment Fraud Continues, Operators Take Action

Online Poker Payment Fraud Continues, Operators Take Action

Global Payments, the company indirectly linked to an ongoing issue with fraudulent gambling transactions, has said its servers haven’t been breached. 

Rumblings of a new online poker scam started to reverberate across Twitter last week. And more information has now come to light. 

At the heart of the matter is a fraudster using stolen data to create fake accounts at licensed U.S. online gambling sites

Poker players with knowledge of how security systems work believe the fraudster is creating fake accounts and using information stored by the payment processor, VIP Preferred. 

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Payment Fraud Affects Online Poker Players and Licensed Operators

When someone uses VIP Preferred for the first time, certain pieces of banking information are stored in a database. This makes it possible for the user to make subsequent deposits without entering their bank details. 

The fraudster is exploiting this feature to make payments to fake online poker accounts without needing someone’s bank details. Once the fraudster deposits an eCheck using VIP Preferred, they request a withdrawal to a fake Venmo account. The scam is complete once the withdrawal has been processed and the fraudster transfers the money from the fake Venmo account to their own. 

Since poker players such as Todd Witteles started piecing together various elements of the scam, more suspicious activity has been reported. Melissa Burr, poker player and operations expert at Nuclear Nerds, has been following the situation closely. 

She tweeted on Nov. 21 that the threat to U.S. online poker players and gamblers remains very real. Burr also believes that the fraudulent activity has been taking place since Oct. 12 and that anyone who has used VIP Preferred could be a target.

Initial reports cited suspicious activity at BetMGM Poker and WSOP.com. We now know that the fraudster has also used DraftKings to scam online gamblers. DraftKings’ security team believes the fraudster has stolen people’s personal details from “other websites.” They’re using this to create fake accounts at DraftKings and other US online gambling sites. 

Global Payments Takes Action

A statement from Global Payments supports this theory. The parent company of VIP Preferred has confirmed that its own servers haven’t been compromised and that information has been stolen from an unaffiliated third-party site. 

“Our gaming business has been assisting law enforcement with an investigation into fraudulent accounts set up at unaffiliated third parties using stolen personal information. There has been no security breach or fraudulent accounts opened at our gaming business in connection with this investigation,” said Vice President of External Communications at Global Payments, Emily Edmonds. 

Edmonds went on to reassure online poker players that an investigation is underway. 

“The protection of our customers and their clients’ information and funds is our top priority and we are working with these third parties to ensure any impacted individuals are refunded,” Edmonds continued.

The situation is evolving and there are almost certainly more things to be discovered. It appears to be the case that Global Payments and licensed US online poker sites have been caught in the firing line. A fraudster has stolen personal data from somewhere and that’s allowing them to exploit gambling operators and their customers. 

How to Avoid Becoming a Victim of Fraud

Melissa Burr has offered some tips on how to stay safe. The main way to reduce the risk of becoming a victim is to close any bank accounts previously used to make gambling transactions via VIP Preferred. 

Burr has also advised online poker players to change the email address and login details for their online gambling accounts. Finally, she recommends locking your SIM card if you use iOS or Android devices for online poker and gambling.

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