According to a recent survey conducted by Frontier Economics on behalf of the Betting and Gaming Council (BGC), up to £4.3 billion is spent yearly by 1.5 million UK citizens on unregulated gambling platforms. This analysis highlights the mounting risks posed by these illicit operations and represents the first significant investigation into the black market since the UK government’s White Paper on gambling reform.
According to the research, unregulated gambling firms are actively pursuing customers in the UK, dodging laws and squandering money that would otherwise go to the government and the sports industry. Unbelievably, young bettors are especially fond of unregulated websites; over 20% of habitual gamblers between the ages of 18 and 24 currently use these illicit platforms, which are frequently accessed through online messaging apps.
The black market’s appeal spans across various gambling forms, with £2.7 billion wagered on online platforms like poker and sports betting, and another £1.6 billion spent in physical gambling locations. BGC CEO Grainne Hurst voiced her concerns about the findings, urging action against the escalating threat. She stated, “Millions of customers are being driven into the arms of pernicious black market operators. The government and the regulator risk sleepwalking into this issue.”
Stricter Regulations May Drive Players to Unsafe Markets
The BGC issues a warning, saying that unduly strict laws may inadvertently encourage more players to engage in illicit gaming. More than 66% of bets made in nations with strict gambling legislation, like Norway, are placed with unlicensed operators. Similar to Portugal, where excessive gambling taxes have driven 31% and 47% of their respective markets to illicit websites.
The black market’s capacity to provide services—like greater bonuses and anonymity—that licensed operators are unable to provide is a key driver of its expansion. Enforcement attempts are hampered by the fact that many bettors use VPNs to access illicit websites located abroad. Furthermore, a sizable portion of gamblers “multi-home,” utilizing both licit and illicit sites.
The BGC has called for closer collaboration with tech firms to block access to unregulated sites. Andrew Leicester, associate director at Frontier Economics, stressed the need for balanced regulations that keep consumers within the regulated market, which offers better safeguards. He noted, “Efforts to make gambling safer are important, but must avoid the risk of pushing more players into unregulated providers who do not need to comply with regulations around safer play.”
While the NHS Health Survey for England estimates that only 0.4% of the population are problem gamblers, the rise of illegal operators poses a serious challenge for regulators and industry stakeholders alike. The need to tackle this issue effectively remains critical as the UK navigates its evolving gambling landscape.
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