Why do online casinos have verification processes?

With fraud and identity theft on the rise, there was a need for some regulation and player and payment protection.

17:32 28 November 2023

The first casino, the Ridotto, was established in Venice, Italy, in 1638. Although not called by the modern term “casino” when it launched, it shows that people have looked to gambling for many centuries and have enjoyed the glitz and the spectacle that comes with having the winning hand at the end of the game. 

Centuries later, some people decided to trade all that spotlight for a quieter time on the internet, playing the same games and making the same money without all the noise. They sought out a newer invention in the name of online casinos, primarily for some privacy. 

But with fraud and identity theft on the rise, there was a need for some regulation and player and payment protection. This materialized as stringent verification processes for players wanting to sign up on their favorite online casinos, in a way taking away the very thing these players traded for the camaraderie of brick and mortar casinos — privacy.

It then begs the question, can we live without these processes? Why exactly do online casinos have verification processes?

Let’s find out!

1. Player Protection

Suppose you are uninterested in any form of player protection, and you are confident in your ability to keep yourself safe playing your favorite titles on the internet. In that case, you should consider crypto casinos and start playing without verification today. Most of the time, the operators do not require new players to provide KYC (Know Your Customer) information on sign-up. Crypto is not regulated in the same way as fiat currencies, meaning these casinos don’t have to verify players’ identities. However, crypto is much more secure than fiat, meaning players already have this built-in protection, even when playing anonymously. 

However, traditional, fiat casinos require these processes to protect players in the following ways:

Reduces Risk of Data Breaches

According to Statista, the first quarter of 2023 alone saw about 6 million data breaches worldwide. Most of these breaches are coordinated attacks by many people scattered around the globe using sophisticated hardware that your run-of-the-mill free VPN and firewall subscriptions cannot even think to handle. 

Your best bet if you want to avoid being part of the statistic is to have your online gaming partner handle and keep these threats at bay. Doing so starts by being able to distinguish between friend and foe, which often requires you to provide you data for safe storage on their database. 

Peace of Mind

When it comes down to it, you have signed up to play online poker, blackjack, or roulette. The last thing you want to be worried about is if the player in the same game lobby as you is good or bad-intentioned. It takes away from the gaming experience. It has you constantly worrying about the people you are interacting with when you should be focused on your gameplay, strategy, and managing your bankroll. 

In the end, there’s a chance you end up losing both your personal information and your money if casinos haven’t correctly verified who you’re playing against.

2. Payment Protection

Only three things are constant in any online casino: people, games, and money!

Past the niceties, people are logged on daily to wager and hope to leave the online casino richer when they log out — and you are no different. 

Now, anybody who has ever made a bet knows there’s always that chance you lose, but what happens when you win and the casino does not honor the arrangement? Even worse, when you consider that in more serious cases, you can not only lose your winnings, but you can have your entire gaming wallet cleaned out. In the very worse case, what if someone bypasses your payment gateway to access your debit/credit card information to make payments in your name?

All these are major reasons why most online casinos have a verification process. It means they have collected the information of other players you’ll be interacting with. They can track their online persona, figure out what people are acting in bad faith, and keep them away from your online profile and wallet. 

It is a simple, easy-to-wrap-your-head-around process that is considered age-old and has proven very effective. 

3. Fair Gameplay

For as long as systems have existed, people have always wanted to cheat the system. One way people look to take advantage of online casinos is to create multiple accounts for the same user to access casino bonuses. 

While this can cause the casino to lose money, it also reduces your chances of a win because the odds become rigged when someone has an unfair chance compared to everybody else who signed up for the same service.

However, online casinos with proper verification requirements can flag multiple accounts by the same user and ensure fair gameplay for all players across the board. 

4. Legal Requirement

Lastly, the reason your favorite casino is requesting you provide personal and bank information is that it is in their licensing agreement. 

Most countries require online casinos to request players to fill in a KYC as part of their Counter-Terrorism Financing (CTF) and Anti Money Laundering (AML) regulations. Failure to do so usually opens the casino to reputational risks and substantial lawsuits that could negatively affect the business.

Conclusion

At the end of the day, these verification processes are put in place to secure the player and the online casino, for the player. There’s an argument for more privacy, but does it outweigh the cons? You decide, and if you’re playing at a no-verification casino, always make sure you choose a reputable platform and watch out for any red flags.