Industries Under Jeopardy Due to Multi-Accounting: Prevention Strategies Revealed in 2024
In the digital age, the practice of multi-accounting has become a significant issue for various online industries. This article explores the prevalence and implications of multi-accounting across different sectors, along with potential solutions to combat this issue.
Multi-accounting, the practice of a single user registering multiple accounts to take advantage of an online service, is a problem that affects numerous platforms. In the gaming and gambling world, unscrupulous players can enrich themselves by selling accounts and certain resources, creating a multi-accounting issue [iGaming]. Fraudsters also use multiple accounts to write fake reviews, book fake trips for onboarding perks, and pose as travel agents to swindle would-be travelers [Travel services].
In the crypto industry, multi-accounting is common in services like airdrops, referral programs, and DAO voting, where individuals create multiple accounts to gain unfair advantages. While not always illegal, it is widely banned or regulated within platforms because it undermines fairness and exhausts system resources [Crypto Industry].
Affiliate fraud is another concern in the e-commerce sector, where users create multiple accounts to collect affiliate and signup bonuses without actually increasing the customer base of the service. Online marketplaces are also targets for promotion abuse, involving the repeated use of sign-up bonuses, referral bonuses, and vouchers from multiple accounts [E-commerce].
In the financial and corporate sector, multi-accounting as multi-entity accounting for businesses operating subsidiaries is a standard legal financial practice to manage consolidated reporting, tax compliance, and regulatory requirements. This differs from user account abuse and is fully legal and structured [Financial/Corporate Sector].
The online dating industry is full of romance scammers and fraudsters that use multiple accounts. In 2022, around 70K people in the US reported a romance scam to the Federal Trade Commission, with overall reported losses hitting USD 1.3 billion [Dating services].
To mitigate the risk of multiple account misuse, companies like Sumsub offer advanced AI-powered solutions like Liveness Detection and Fraud Network Detection. Liveness Detection involves biometric analysis of the user's face and facial movements to ensure their true presence during the check and help businesses ensure that users are genuine individuals-and not just the same person with an endless number of accounts [Liveness Detection]. Fraud Network Detection continuously analyzes user behavior at every stage of the customer lifecycle, including onboarding, AML-screening, and transactions, and can easily detect multi-accounting through IP address analysis, behavioral biometrics, and device fingerprinting [Fraud Network Detection].
In summary, while multi-accounting as abusive multiple user accounts is often banned but not always criminal, multi-entity account management for legal business purposes is fully legal and frequently necessary. The key legal distinction is whether the multiple accounts are used for legitimate governance and compliance versus platform rule violation and abuse.
References: 1. Crypto Industry 2. Financial/Corporate Sector 3. Freelancing Marketplaces (Fiverr) 4. E-commerce (Shopify) 5. Sumsub's 2023 Identity Fraud Report
- In finance and personal-finance, multi-accounting as multi-entity accounting for businesses is a legal practice to manage consolidated reporting, tax compliance, and regulatory requirements.
2.Shopping online, whether on freelancing marketplaces like Fiverr or e-commerce platforms like Shopify, can be prone to multi-accounting, such as affiliate fraud and promotion abuse, which can lead to false profits and unfair competition.
- Technology, particularly in data-and-cloud-computing, has provided solutions to combat multi-accounting, such as Liveness Detection and Fraud Network Detection, which use AI and biometrics to ensure users are genuine individuals and not multiple accounts owned by the same user.
- The world of sports, while not directly affected by multi-accounting on online platforms, shares the concern for fraudulent activities that can lead to unfair advantages, as seen in doping scandals.
- In the realm of cybersecurity, multi-accounting, if used for malicious purposes, can result in various threats, such as identity theft and cyber attacks, underscoring the importance of safeguarding online accounts.
