BGC Warns of ‘Complacency’ as UK Black Market Gambling Stakes Double to £2.8bn

  • Council said a PwC study published Thursday is a warning of the “dangers of complacency”
  • Study showed a doubling of stakes with illegal operators, a similar increase in black market users
  • European countries with more stringent gambling regulation had larger black markets than the UK
  • BGC advised a cautious approach with reforms prompted by the current Gambling Act review
man in suit presses black market button on screen
The Betting and Gaming Council has highlighted the new PwC study’s findings of how black market gambling activity more than doubled over the past two years in the UK. [Image: Shutterstock.com]

Worrying signs for the UK market

The Betting and Gaming Council (BGC) has warned of “the dangers of complacency” after reviewing the findings of a new study into the UK’s black market.

PricewaterhouseCoopers LLP (PwC) published its Review of unlicensed online gambling in the UK on Thursday morning. The 66-page document used black market data collected between November and December last year. PwC then compared these findings with a similar study conducted in 2019.

The UK gambling industry’s representative body took to Twitter to share the findings of the study:

The amount staked with illegal UK operators more than doubled year-on-year in 2020, from £1.4bn ($1.9bn) to £2.8bn ($3.8bn). The number of customers using unlicensed betting sites also increased by over 100% to 460,000.

customers using unlicensed betting sites also increased by over 100%

BGC CEO Michael Dugher said the findings serve as a warning to those who “seek to dismiss or play down the threat of the black market.”

Further findings of the study

In its introduction to the report, PwC said it intended to provide an “evidence-based review of unlicensed online gambling activity in the UK.” The company made clear that it aimed not to “advocate for any policy or regulatory outcome,” but to help inform discussions.

share of online stakes placed with unlicensed operators rose from 1.2% to 2.3%

The percentage of UK online gamblers using unlicensed operators increased from 2.2% to 4.5% over the past two years. The share of online stakes placed with unlicensed operators rose from 1.2% to 2.3% in the same period. The study found that those bettors who used illegal betting sites “almost always” wagered with licensed operators as well.

As part of the report, PwC conducted studies into the regulated gambling markets of other countries. It found that the UK’s open and competitive gambling sector had a smaller black market share than “European benchmarks”, including France, Norway, Italy, and Spain. The BGC said such findings suggest that stringent restrictions on operators only increased black market activity.

The UK Gambling Act review

The UK government is currently conducting a review of the Gambling Act 2005, which dictates regulation for the country’s gambling industry. As part of the review, national authorities announced a ‘Call for Evidence’, requesting information on the black market among other areas. PwC’s study will serve as part of this evidence.

Dugher said PwC’s findings demonstrate the “growing threat” of the UK’s illegal market. However, the BGC urged MPs to ensure they only make “carefully thought out” changes to UK gambling law. The council has consistently advocated for evidence-based reform, warning against draconian measures which, it argues, could increase black market share.

The UK’s Department for Digital, Culture, Media and Sports (DCMS) began its review of the Gambling Act in December last year. So far, the government has only increased the minimum age of National Lottery participants from 16 to 18. A number of other subjects that are up for consideration include stake limits for online gambling, curtails of gambling advertising in sports, and the issue of loot boxes.