South Africa’s know-your-client (KYC) and anti-money-laundering (AML) tools are seen as fragmented, as the country experiences a three-fold surge in iGaming fraud.
This, even though the country was taken off a global financial watchdog’s greylist last October.
According to Sumsub’s 2026 iGaming Fraud Report, the increase in local fraud is “the kind of curve that is worth keeping an eye on”. The online verification platform found that Africa is the epicentre of fraud globally, recording the highest fraud rate at 2.54% of any region analysed worldwide.
iGaming encompasses all types of online games related to gambling or betting. This includes activities such as online casinos, sports betting, poker, bingo and other forms of gambling.
“South Africa recorded a more than threefold increase in iGaming fraud during the second half of 2025,” says Jarryd Jensen, regional director for Southern Africa at Sumsub. He notes this highlights a broader shift in how fraud is evolving across Africa, with artificial intelligence (AI) becoming more readily available and cost-effective.
According to Sumsub’s data, 97% of all fraud detected in Africa is intercepted during the liveness stage – the facial biometrics check – where the individual attempting verification does not match the legitimate identity associated with the account or document.
Faking it
However, fraudsters are increasingly using AI tools, which are becoming more readily available and cost-effective to create deep fakes of ID documents, says Jensen, noting this requires advanced technology to detect and mitigate.
As a result, Jensen sees South Africa’s current AML and KYC tools as fragmented because humans can’t keep up with technological advances. “It’s going to continue to be fragmented until technology is actually being used to sort of govern technology.”
South Africa was placed on the Financial Action Task Force’s greylist in February 2023 over deficiencies in its AML and counter-terrorism financing framework, before exiting in October last year after completing the 22 reforms required under its action plan.
While Samantha Ponto, risk and fraud manager at local online bookmaker Jabula Bets, notes KYC and AML tools have improved through Financial Intelligence Centre Act-aligned compliance frameworks and the increased use of automation and behavioural monitoring, there are still challenges in clamping down on fraud.
The Banking Association South Africa explains banks are implementing behavioural analytics tools that build individual risk profiles and use machine learning to flag activity that deviates from normal patterns, allowing fraud teams to intervene before losses occur.
A shift towards behavioural monitoring is echoed by a May BioCatch survey, which found that 74% of South African banking leaders viewed behavioural solutions as highly-valuable for detecting coerced or high-risk user behaviour.
“Sophisticated fraud, which is mostly being created using AI… requires far more advanced verification, risk monitoring and transaction monitoring solutions throughout the customer journey. You need to be able to pick up on small discrepancies that humans won’t actually be able to pick up,” says Jensen.
A whole new world
Ilya Nestserau, anti-fraud team lead at SOFTSWISS, expects AI-powered fraud schemes to “become a new reality in the near future” as cheap GenAI models proliferate. “With the growth of quality generated by AI pictures, fraudsters are not required to have complex skills of photo editing.
“Africa’s rapid digital adoption has also attracted increasingly sophisticated fraud actors,” says Jensen. He notes fraudsters are “moving beyond the traditional types of methods, such as document forgery and using stolen identities,” with AI-assisted content and coordinated fraud networks increasingly being used to target digital platforms.
Sumsub’s findings, contained in its iGaming Fraud Report 2026, comes as online gaming continues to grow.
National Treasury’s discussion paper on a proposed national gambling tax puts total gross gambling revenue at R74.5 billion in the 2024/25 financial year, a 25.6% increase from the previous year.
Much of this has shifted online, with the South African Reserve Bank’s Quarterly Bulletin saying the post-COVID-19 surge in online activity, as lockdowns closed physical casinos, drove online betting from 80.7% of total betting revenue in 2023/24, to 85.5% in 2024/25.
Continental drift
On the continent, Côte d’Ivoire moved to the top spot year-on-year, followed by Burkina Faso, Cameroon and Malawi. The Democratic Republic of the Congo sits in fifth place. Outside of the top five, Ghana, Kenya, Nigeria and Uganda all showed declining fraud trends as of the last quarter of 2025. “That is good news on the surface, although the levels remain high,” Sumsub states.
The report was based on analysis of more than three million fraud attempts and millions of identity verification checks conducted between 2024 and the first quarter of 2026.
“While Africa experienced a temporary decline in fraud during 2025, the region rebounded sharply in early 2026 and became the single largest contributor to the global increase in iGaming fraud,” Sumsub says. “Globally, fraud rates rose nearly 18% year-on-year, while the rate of suspicious transactions increased more than 4.5 times and the average suspicious transaction value climbed to more than $6 500.”
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