Politics Home | Every customer lost to the illegal market should be a concern to us all

Credit: Kennan Constance, Unsplash

The regulated betting and gaming sector takes gambling harm seriously and recognises its responsibility to protect consumers. Millions of adults enjoy betting safely each month, but we know gambling can cause harm for a small number of individuals and families. NHS figures estimate that 0.7 per cent of adults experience problem gambling, and every one of those cases is a cause for concern. That is why our members continue to invest heavily in safer gambling tools, technology and interventions designed to reduce risk and support those who need help.

But if we are serious about protecting consumers, we must also be serious about confronting the growing threat posed by the criminal gangs operating the illegal gambling market.

Recent claims have suggested concerns about illegal gambling are overstated because unlicensed operators account for less than 10 per cent of the market. Even if that figure is accepted, it should alarm everyone involved in this debate.

Britain is home to 22.5 million adults who place a bet each month. If anything close to one in ten pounds staked is taking place with illegal operators, that is not a reassuringly small figure. It represents a major consumer protection failure, exposing hundreds of thousands of consumers to criminal operators who offer none of the protections available in the regulated market.

That is not a marginal issue. It is one of the most significant consumer protection challenges facing the sector today.

Independent analysis by H2GC forecasts that stakes with illegal operators could almost double from £17bn in 2025 to more than £33bn by 2028. On that trajectory, almost one in every five pounds staked online could be placed with an unlicensed operator within three years.

That should concern anyone who genuinely cares about reducing gambling-related harm. Because every customer who moves from a regulated operator to a criminal one loses the protections, safeguards and interventions designed to keep them safe.

Too often, discussions about gambling policy focus solely on restrictions placed on licensed operators, without considering where customers go if they become frustrated with the regulated market. History shows that consumers do not stop gambling because of increased regulation, product restrictions or outright bans. Many seek alternatives.

When they do, illegal operators are waiting.

Unlike licensed betting and gaming businesses, black market operators are not accountable to the Gambling Commission. They do not have to conduct safer gambling interventions. They do not participate in self-exclusion schemes such as GAMSTOP. They do not face the same requirements around age verification, customer protection or anti-money laundering checks. They pay no UK tax, contribute nothing to British sport and have no obligation to support research, prevention or treatment programmes.

Most importantly, they offer customers no meaningful protection when things go wrong.

That distinction matters. Customers who use licensed operators know games are independently tested, funds are protected and winnings are paid fairly, protections that simply cannot be guaranteed in the illegal market.

The debate should never be framed as a choice between regulation and no regulation. The real question is whether policies strengthen the regulated market or inadvertently drive consumers towards illegal alternatives.

Well-designed regulation is essential. But regulation must also be proportionate, evidence-led and focused on achieving its intended outcomes. It should be reviewed regularly, with policymakers and regulators willing to adapt when evidence shows change is needed.

The impact of regulation must always be assessed in the round. Policymakers should consider the cumulative effect of multiple interventions rather than drawing conclusions from individual measures in isolation.

When customers remain within the regulated sector, they are protected by a framework of safeguards that has become increasingly robust in recent years. Standards have risen significantly, and operators continue to work closely with regulators, government and charities to improve protections further.

The danger comes when policies create incentives for customers to seek out operators who simply ignore British law altogether.

Every customer lost to the black market is a customer lost to protection.

This challenge requires a coordinated response. The Government’s Illegal Gambling Taskforce is a welcome step forward, but it must be matched by practical action.

The Betting and Gaming Council has proposed a five-point plan to tackle illegal gambling, including stronger action against illegal advertising, faster disruption of unlicensed websites, tighter controls on payment providers facilitating unlawful transactions, greater accountability for businesses that enable illegal operators, and tougher enforcement against those targeting British consumers.

This is not about protecting the interests of licensed operators. It is about protecting consumers.

There will always be those who oppose gambling in all its forms. But policymakers should be wary of arguments that minimise the risks posed by criminal operators or dismiss concerns about consumer migration to the black market.

There is a fundamental difference between a regulated British business operating under licence and an illegal offshore operator operating outside the law.

One is accountable. The other is not.

One is required to protect customers. The other has no such obligation.

One contributes to society through jobs, tax revenues and support for sport. The other simply extracts money from British consumers while avoiding responsibility.

That is why the debate about illegal gambling matters.

Whether the black market accounts for five per cent, nine per cent or more today is not the point. The real question is whether policymakers are willing to act before it grows larger still.