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Online casinos drive increase in cybercrime

Online casino operators are fuelling an increase in cybercrime, according to a new McAfee whitepaper, entitled Jackpot! Money Laundering Through Online Gambling.

The report found Cyberattacks are being funded via untraceable payments through online gambling sites, while illegal proceeds can be made virtually untraceable by wagering them on one end of a transaction and receiving the payouts as gambling wins on the other end.

Gambling wins can also be exchanged as payment for illegal goods or services changing hands elsewhere.

According to Gambling Research Australia Online, gambling around the world is prolific, and although online gambling operations are illegal in Australia, there are still about eight per cent of Australians involved in some form of interactive and online gambling.

However, it is legal for Australian gamblers to bet on international gaming and gambling sites.

The McAfee report found there were three critical areas where online gambling platforms enable money laundering for criminals.

Firstly, anonymity is a key driver.

Because online gaming was from its inception designed to operate across jurisdictions, in a commercial trade illegal in many jurisdictions, operators are fairly explicit about the level of anonymity afforded to online players.

Secondly, the popularity of online gambling has driven the development of a value chain enabling a wide variety of gaming operators, featuring various account deposit and withdrawal methods, and middleman entities processing the transactions.

Lastly, the sheer number of online casinos is so great that it is difficult for local authorities to monitor let alone police their activities.

The report said cybercrime was becoming the new theatre for the 21st century criminal.

According to the US Federal Bureau of Investigation Bank Crime reports, bank robberies in 2011 fell to 5,104, from 5,546 in 2010.

A 2013 FBI assessment said online casinos were vulnerable to a wide variety of criminal schemes.

“For example, criminals may participate in games with exclusively criminal players, exchanging money to launder proceeds; or a criminal might intentionally lose a game to a public official in order to effect a bribe payment.”

The McAfee report said, “each of the four major online segments (sports betting, poker, casino, and bingo) would continue to grow, reaching approximately US$43.0 billion by 2015.

Given the growing and ever-changing landscape of online gambling players and enablers, those working to apprehend cybercriminals must be able to leverage cross-sector/border and public-private partnerships, combining the capabilities of law enforcement, ISPs, Internet security companies, independent monitoring organisations, academia, and the financial institutions ultimately in receipt of suspicious fund transfers.

McAfee supports the strategy taken by Europol’s European Cybercrime Centre which takes a tactical approach to tackle cybercrime on a number of fronts.

It supports, data fusion, the gathering and processing of information on cybercrime, and maintaining technical expertise for law enforcement in all member states.

It also supports local global partnerships, training and awareness, and the development of forensic tools to enable member states to more effectively detect and prosecute cybercriminals.

The report said more games, more access, and more transaction methods were leading to greater opportunities for would-be criminals to hide their illicit gains from the prying eyes of global law enforcement agencies.

“Without a means to cash out, the volume of cybercrime would decrease,” the report said.

“However, the anonymous online money-laundering marketplace today is growing rapidly with the volume of attacks.

“Although requiring licenses for gambling operators is an important approach, this step does nothing to halt the tide of unlicensed operators.

Tags Europol’s European Cybercrime CentreGambling Research Australia OnlineJackpot! Money Laundering Through Online Gambling whitepaperMcAfee; cyybersecuritymoney laundringUS Federal Bureau of Investigation Bank Crime reports

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