The gambling industry is facing a battle to tackle the increase of illegal online operators. New research has shown that the black market is expanding and attracting mainstream consumers. A Gambling Commission report on unlicensed gambling would assume that self-excluded or underage bettors would use but following the results that wasn’t the case.
It found that the profiles of legal and illegal gamblers are almost identical with mainly men aged between 18-24 frequently betting and those with higher problem gambling scores.
Experts warn that many players can’t recognise what is a licensed site and what isn’t. We spoke to a partner at Bird & Bird who said the findings reveal a growing disconnect between consumers and operators. To verify legitimacy is extremely difficult.
Alasdair Lamb from CMS highlighted that most players still prefer regulated sites but the black market supplements rather than replaces legitimate betting.
The Betting and Gaming Council also known as the (BGC) have estimated that £4.3 billion is spent manually on illegal websites annually with 1.5 Britons using them. It warned that increased taxation and high regulation on people’s personal details will push more players to unregulated platforms.
The findings have sparked a divide in the industry. Ismail Vali who’s Yield Sec CEO a company which tracks illegal gambling activity disputes the conclusions given by the regulator. He says the vast majority of illegal gambling stems from underage users and people who have self excluded from sites under the licensed umbrella.
Yield Sec say that the UK’s black market has risen from 0.43% of total activity in 2020 to nearly 9% in 2025. Also stated that there are over 500 illegal operators pinpointing British consumers.
On the other hand GamStop which is the national self-exclusion scheme for the UK says that only a small minority of the 600,000 registered users go and use casinos not on Gamstop. But Vali argues that it’s a growing problem with illegal gambling increasing every year and thriving on platforms that entertain illegal streaming and advertising.
The Gambling Commission faces limits in tackling overseas operators, say industry lawyers. The direct approach to target suppliers of the unlicensed games is a challenge. GamStop and the commission are pushing for greater powers under the forthcoming Crime and Policing Bill which would give permission to remove illegal gambling domains more quickly.
The UK’s black market boom reflects a big blind spot in current regulation. The tightening of rules for licensed platforms is only pushing more bettors to sites which may look legitimate but in fact are unregulated. That being said, vulnerable bettors are more at risk of harm with limited safe gambling buffers in place.