According to Yield Sec., UK black-market gambling operators increasingly target vulnerable players.
Research revealed that black-market operators were increasingly targeting players who self-excluded from GAMSTOP. It was found that the number of illegal operators had also increased by “fourfold” from 2021 to 2022. This number then doubled to 231 in 2023. More than 1,000 affiliates have helped publicise the illegal operators.
Yield Sec estimates that the illegal gambling sector now accounts for 4% of UK online gaming market revenue and gross gambling revenues (GGR). The result is a substantial drop in revenue for tax and funding of responsible gambling programs such as GAMSTOP.
Data showed that illegal operators ignored “mainstream clients”. Yield Sec stated that they targeted vulnerable demographics such as children and self-excluded gamers.
Yield Sec found that thousands of Google searches were conducted to avoid self-exclusion. Yield Sec had detected millions of Google searches for “not on GAMSTOP”, and similar results, by January 2024. It allows gamblers who are vulnerable to self-exclusion policies to play with licensed operators.
In order to avoid this, players at risk are tempted to place bets with potentially unsafe and illegal operators who cannot be monitored by software such as Yield Sec or GAMSTOP.
Ismail Vali commented, “Our surveillance highlighted the disturbing growth and cynical nature of certain types of illegal operators present in UK during the last three years.”
The evidence that illicit gambling is being used to circumvent GAMSTOP and allow vulnerable problem gamblers avoid self-exclusion, and to do so in a cynical manner, is disturbing and requires immediate and meaningful action.
UK White Paper’s Illegal Market Measures
Vali, citing Yield Sec findings, has stated that he would like to see additional resources allocated towards the prevention and detection of illegal gambling. Vali has stated that he wants to see more resources dedicated towards the prevention of illegal gambling.
The UK white paper will be released on April 20, 2023. In the white paper, it was stated that increased regulatory powers would be used to fight illegal gambling.
David Brown is a UK veteran of the industry since 1976 and he was the former executive director at William Hill, Coral and LadbrokesCoral. He believes that the checks on affordability in the whitepaper are driving the most vulnerable to the blackmarket.
Brown said in a recent iGB interview that the current scenario, which involves potentially intrusive affordability tests, is likely to encourage criminal operators throughout Britain. There is no place for complacency.
It would be wise to recognize the danger of illegal activities and to work together as a group to detect them and to prosecute.
Stopping illegal traffic by geo-blocking or advertising in the country would be a great place to begin.
This will however not stop British bettors from engaging in betting with operators who are outside of the GC’s jurisdiction. It also doesn’t identify black-market non-digital gambling in Britain.
France and Germany also struggle with black market issues
Illegal gambling isn’t just a problem in the United Kingdom. Germany and France both revealed that the black market is prevalent in their countries.
Recent research found that nearly half of online gambling in Germany is conducted by unlicensed operators. The German gambling regulator GGL is under increased pressure to tackle the problem.
According to the study, three quarters of revenues are generated by black markets. In October 2023 it was reported that Germany’s licensed gaming operators were under greater pressure than ever from the black market.
The regulator in France l’Autorite Nationale des Jeux ANJ estimated that the black market could be as high as EUR1.5bn. Over 10% of all bets placed in France are on the black market.
Since then, the ANJ revealed an action-plan to combat illegal gambling. The ANJ took a number of measures, including increasing cooperation with European regulators and boosting public awareness about the dangers associated with illegal gambling.
