“ The only way to [ block illegal sites ] is through Pix payments methods ,” Baungartner tells iGB . “ Blocking IPs or URLs doesn ’ t have any effect in the long term . That ’ s not something that we , the industry , are telling them [ to implement ].”
The CCO expects the initiative to have a 70 % success rate as blocking Pix payments will prevent illegal sites from taking payments and providing a seamless customer journey .
Comparable measures in Germany are reaping results says Priglinger-Simader . “ We hear from the GGL that they see a real impact in payment blocking . Many of them are not able to receive payments services anymore which means this seems to be the best enforcement option at the moment .”
Unfortunately , the illicit market is particularly innovative and from this has come the proliferation of cryptopowered betting sites , which authorities are not yet able to mitigate . It will be of great interest to see if Brazil ’ s government is able to ban crypto sites from operating in their licensed market , as they have pledged .
REPRESSIVE AND DRACONIAN REGULATIONS
Ultimately , enforcement is only one element of the complicated strategy needed . Hurst isn ’ t convinced . “ Enforcement will never prevent black market gambling on its own ,” she says . “ You have to keep the regulated market the most attractive place to bet and game . Draconian measures do not prevent gambling , instead they drive up black market activity .”
Tightened restrictions in regulated markets , or “ draconian measures ” as Hurst calls them , are inadvertently aiding the black market ’ s growth . Taking the Netherlands as an example , a 7.3 % gambling tax hike by 2026 will likely stifle the still-young market .
$ 2.7bn
Annual value of the UK gambling black market
( source : BGC )
90 %
Channelisation rate in Denmark
5,000
Number of blacklisted sites Brazil ’ s government ordered to be shut in advance of the market opening
And in response to the measure , both LiveScore Bet and Flutter ’ s Tombola have exited the Netherlands . Stakeholders have warned others will face a similar fate .
The market is becoming less attractive to both operators and players due to less competition and additional costs . Hoffstedt believes all licensed European jurisdictions are focusing too heavily on repressive measures . Neal Menashe , CEO of the publicly listed Super Group , strongly agrees , likening these regulatory changes to civilians being punished for the actions of criminals .
Among these measures are the affordability checks and slots stake limits being initiated in the UK . “ It is counterproductive to safer gambling efforts if regulations make the legal sector a less attractive option . We certainly see that with spending checks that include friction – customers simply do not want to hand over private financial information . In that scenario they will either stop betting , or consider shifting to the black market ,” Hurst says .
But she remains optimistic about the actions of the UKGC . “ We are really encouraged by what we have heard from the UKGC in recent months on this issue and we are keen to collaborate .”
KEEPING AN EYE ON YOUR SUPPLIERS
In its October 2024 briefing , UKGC CEO Andrew Rhodes advised operators to carry out sufficient due diligence on their supplier partners , so as “ to ensure none of [ them ] are directly or indirectly engaged in supporting unlicensed activity ”. Both Williams and Priglinger-Simader flag this suggestion as controversial .
“ I think it ’ s incredibly difficult for licensed operators to bring that pressure to bear on the suppliers ,” Williams laments . For his part , Priglinger- Simader says the onus should be on the regulator to ensure suppliers are being compliant .
Every stakeholder has a role to play in stamping out illegal gambling but there are conflicting views on the role operators , regulators and governments should play in these efforts . It is up to the sector to work together with their third-party stakeholders to determine how to best approach the problem . And at the moment Vali says a constructive effort , one that includes neighbouring sectors like sports , streaming , internet services and digital media , is required .
“ The ecosystem connected to this issue is vast ,” Hurst concludes . “ We need to keep the pressure on , keep raising this issue in the media and with policymakers , and ensure those other stakeholders are aware they have skin in this game too .”
ICE 2025 • ISSUE 137 • 33