Your nondescript web hosting merchant may be harboring pirates. G2 analysts have discovered a trend where illegal internet protocol television (IPTV) vendors launder transactions through seemingly benign web hosting shops. Bad actors stealthily avoid detection from merchant acquirers by funneling transactions through a ubiquitous enterprise like web hosting.
Take the case below. The first image shows a web hosting shop. It appears normal, but it’s a front. We found that an IPTV shop, shown in the second image, links directly to the web hosting shop when the user selects an IPTV package.
G2 analysts found that this web hosting shop processes transactions for an IPTV network with over a hundred different websites.
What is IPTV?
Put simply, IPTV is television delivered through the internet. This broad definition defines legitimate streaming platforms like Netflix, Hulu, and Fubo TV as IPTV. However, modern internet parlance often links IPTV with illegal subscription-based streaming services. You can tell an IPTV service is probably illegal when it offers cheap packages with thousands of channels, movies, videos on demand (VODs), and adult videos. For example, one IPTV shop we recently encountered offered 146,000+ worldwide TV channels and 90,000+ VODs from Netflix, Disney+, Apple TV, and HBO—all for $9/month.
Why Web Hosting?
As experts in finding and tracking illegal laundering operations, here’s our educated guess:
- Web hosting and IPTV are payment compatible
A front website can duck suspicions by matching its prices to the violating content. In this case, both IPTV and web hosting services use subscription models, and both typically range in cost from a $5 free trial to a $120 yearly subscription. - Web hosting is simple
Web hosting shops require only barebones storefronts. Many of these fake web hosting websites lack product images and product descriptions. - Previous success
When one launderer has had success with this format, others follow suit. We’ve even seen multiple fronts using the same portal, web formatting, design, pages, etc.
For example, compare the following images from three different fronts:
Why Does it Matter?
When card brands discover transaction laundering operations like those described above, they dole out hefty fines to acquirers—even if the acquirers are unwitting accomplices. This makes it the acquirer’s responsibility to identify and eliminate illegal operations. Discovering the trend is the first step to eliminating it. G2 expert analysts use technology and human expertise to uncover dozens of these cases monthly.
Fraud constantly evolves. Violators have begun using other types of fronts for IPTV, including cloud storage, VPNs, and SEO optimization services. Your best protection against this threat is to partner with a merchant monitoring expert like G2, specializing in identifying violating content and transaction laundering.
To learn more about transaction laundering, download our Real-life Launderers guide or contact us.
