A new study conducted by Frontier Economics, commissioned by the Betting and Gaming Council (BGC), has revealed that approximately 1.5 million Britons stake up to £4.3bn annually on the illegal gambling black market. The report highlights significant concerns about the widespread use of unregulated gambling platforms, both online and in underground venues, which undermine player protections and deprive the UK Treasury of substantial revenue.

The research found that illegal operators are aggressively targeting UK customers, particularly young adults aged 18-24, and those who have self-excluded from regulated platforms. More than one in five bettors in this age group have already gambled through black market channels, which operate without the safeguards found in the regulated sector. This includes features such as deposit limits, time-outs, and self-exclusion tools provided by BGC members.

The study also emphasized the broader economic impact, suggesting that continued growth of the black market could result in the loss of up to £335 million in tax revenue over a five-year period. The BGC advocates for balanced regulations and stable taxation as the most effective means of countering the illegal gambling market. The report draws comparisons to countries like Norway and Bulgaria, where stringent regulations have led to a surge in unregulated gambling activity, with significant portions of total stakes being placed on illegal platforms.

The BGC has called for stronger collaboration with internet platforms to combat the rise of illegal gambling, which often goes unnoticed by consumers. In many cases, players are unaware they are using unregulated sites, which mimic the appearance of legitimate platforms.

The study serves as a critical reminder of the importance of maintaining a regulated iGaming environment to ensure player safety and protect economic contributions made by the licensed sector, which supports 110,000 jobs and generates £4.2bn in tax revenue annually.

Betting and Gaming Council CEO Grainne Hurst, said: “This shocking report exposes the unnerving true scale of the growing, unsafe, unregulated gambling black market.

“From online gaming, to betting on sports like horse racing, millions of customers are being driven into the arms of pernicious black market operators. These people don’t care about player safety, don’t want to pay their fair share to support sport and don’t pay a penny in tax.

“By failing to adhere to the stringent standards set by the Gambling Commission, unregulated operators in the unsafe black market can make bigger offers, grant customers total anonymity, and promise the freedom to gamble without any controls or safety measures, unlike BGC members.

“Worst of all, these sites are making a mockery of the rules set up to protect the most vulnerable by aggressively advertising their services to those who have self-excluded.

“The Government and the regulator risk sleepwalking into this issue. Simply giving the GC more powers and more resources to tackle the black market won’t, in itself, work. Enforcement is only part of the solution.

“The fact is onerous and ill-judged regulations drive customers from the regulated sector to the unsafe, unregulated gambling black market.

“Proposals by anti-gambling prohibitionists like advertising bans or intrusive, blanket, low level affordability checks will not protect customers, in fact they will give another leg up to unscrupulous black market operators, the last thing anyone wants.

“Every comparable market in the world tells us the same thing. The best defence against this growing illegal, gambling black market is getting the balance of regulations right.”

Andrew Leicester, Associate Director at Frontier Economics and one of the report’s authors, said: “This report shows that most gambling today is done through regulated, visible channels. That is good news.

“But there are warning signs. The landscape is evolving quickly in ways that suggest black market gambling is getting easier to find and access.

“This report provides timely new evidence on the scale of the black market. Efforts to make gambling safer are important, but must avoid the risk of simply pushing more players and spend into unregulated providers who do not need to comply with regulations around safer play.”

The full report can be read HERE.