Alarming report warns UK gamblers turning to black market due to regulatory friction
A study by a gambling harm awareness charity has warned that regulation and influencer marketing are leading players to black market sites.
UK.- A new report has suggested that a combination of influencer marketing and regulatory controls are driving more British gamblers to unlicensed black market gambling sites. The report also cites a lack of legal cryptocurrency wagering as a cause of migration to illegal offerings.
The findings come in a new Black Market Report from the Welsh gambling harms charity Deal Me Out. It should be noted that the organisation receives funding from the regulated gambling sector.
The study involved a survey of over 1,250 children, 300 adults and 10 gambling content creators. It concluded that gamblers were being driven to unregulated platforms by social media influencers and friction created by regulatory measures such as financial risk checks and new online casino stake limits.
Some respondents raised concerns about having to give more personal information to operators and about no longer having certain bonuses and turbo spins in licensed offerings.
Meanwhile, the report estimates that up to 420,000 school children could be using black market gambling, particularly through loot boxes and in-game currency in video games, although it’s not clear here whether the report is referring to prohibited products. There is currently no ban on loot boxes in the UK.
One respondent said: “It was social for me. My friends and I would come home from school, jump on Discord and watch each other gamble. We’d also be gambling with our gaming friends from the US, South America and Asia. There is something quite appealing, sitting next to your friends on a virtual table.”
Influencers: ‘no choice’ but to promote black market gambling
The report mentions a figure of five million social media clicks a month going to unlicensed sites via affiliate links posted by streamers and influencers. It noted that some influencers tell users how to use VPNs to access blocked sites.
Nine of the 10 content creators surveyed promoted the online crypto betting platform BC Game, which is no longer licensed in the UK since the end of its white label agreement and no longer licensed in Curaçao either.
Some influencers said they have no choice but to promote unlicensed sites if they want to compete. “Regulation has forced our hand; if we don’t use crypto casinos we just can’t compete,” one YouTube creator is cited as saying “Our viewers want to watch bonus buys, turbo spins, high rolling content, something we just can’t do in the UK anymore.”
A TikTok creator said: “Look at content creators in Germany, France, Belgium – they’re all using crypto casinos. Americans, Canadians, Australians too. Show me a streamer that’s using UK regulated websites to create content, and I’ll show you a fool.”
How to combat black market gambling
The report suggests that there is a lack of public awareness as to how to identify what sites and products are illegal. It finds that “people that gamble and those that don’t are equally unable to tell what is regulated and what is not”.
It also argues that “disruptive methods” of tackling the problem, such as cease-and-desist letters, were not sufficient alone. It compares these to a game of whack-a-mole since operators can open mirror sites as soon as one site faces blocking or fines.
Instead, the report recommends an “urgent review” of crypto gambling and a preventative information campaign to educate the public about unlicensed sites, fake games, payment refusals and criminal activity.
New Gambling Commission guidelines
Meanwhile, the Gambling Commission has updated its anti-money laundering and terrorist financing guidelines to address emerging threats.
The regulator said criminals are using AI to create false documents, deepfake videos and face-swap images and videos to facilitate money laundering. As a result, it says that gambling operators must train staff to alert for AI-generated documents submitted for due diligence purposes.
Another concern is an increase in reports of criminals offering people money for their personal details in order to open mule accounts. The regulator also warned about the growing popularity of crash games offered by unlicensed crypto casinos.
