Guidance
The 2026 money laundering and terrorist financing risks within the British gambling industry
The Gambling Commission's money laundering and terrorist financing risk assessment of the British gambling industry for 2026.
14 - Arcades
Sector rating
| Sector | Previous overall risk rating | Current overall risk rating |
|---|---|---|
| Adult Gaming Centres (AGCs) | Medium | Medium | Family Entertainment Centres (FECs) | Low | Low |
The Adult Gaming Centre (AGC) sector continues to be rated as medium risk for money laundering.
The sector faces risks associated with the monitoring of gaming machine activity in a live premises environment. When gaming machines are used in conjunction with ticket-in-ticket-out machines and automatic ticket redemption machines, there is a risk that staff have less oversight of the transactions.
The level of activity in AGCs has increased since the previous risk assessment. For the period April 2022 to March 2023, gross gambling yield (GGY) in the sector was £561 million and, for the period April 2024 to March 2025, it rose to £683 million1.
It has been identified in casework that some AGCs operate staff bonus schemes. There is the potential for staff to be incentivised to overlook money laundering risks presented by customers under such schemes, if appropriate safeguards are not in place.
Family Entertainment Centres remain low risk. The low-level nature of transactions in the sector means that there is limited potential for the sector to be exploited for money laundering. For the period April 2022 to March 2023, gross gambling yield (GGY) in the sector was £40 million2.
Risks
| Vulnerability | Risk | Likelihood of event occurring | Impact of event occurring | Overall risk | Change in risk |
|---|---|---|---|---|---|
| Operator Control | Operators failing to comply with prevention of money laundering and terrorist financing legislation and guidance | Medium (2) | Medium (2) | Medium (4) | Increase in likelihood | Operator Control | Lack of competence of key personnel and licence holders which can be exploited by criminals seeking to launder the proceeds of crime (AGCs only) | Medium (2) | Medium (2) | Medium (4) | Increase in likelihood | Operator Control | Lack of competence of key personnel and licence holders which can be exploited by criminals seeking to launder the proceeds of crime (FECs only) | Low (1) | Low (1) | Low (1) | Decrease in likelihood | Operator Control | Inadequate ‘know your customer’ (KYC) measures - including failure to obtain additional information following a risk-based approach (AGC only) | Medium (2) | Medium (2) | Medium (4) | New risk | Operator Control | Lack of appropriate customer activity and transaction monitoring (AGC only) | Medium (2) | Medium (2) | Medium (4) | New risk | Operator Control | Lack of closed-loop system | Medium (2) | Medium (2) | Medium (4) | New risk | Operator Control | Training for staff is insufficient and is not appropriately tailored | Medium (2) | Medium (2) | Medium (4) | New risk | Operator Control | Staff bonus schemes creating an incentive to overlook money laundering risks | Low (1) | Medium (2) | Low (2) | New risk | Operator Control | Inadequate due diligence checks on business-to-business relationships or business investors resulting in receipt of illicit funds | Low (1) | Medium (2) | Low (2) | No change (new wording) | Customer | Customer gambles at multiple premises or operators to disguise the source of their funds | Medium (2) | Medium (2) | Medium (4) | New risk | Means of Payment | Cash transactions - this includes the risk of dyed and counterfeit notes | Medium (2) | Medium (2) | Medium (4) | No change (new wording) | Means of Payment | Ticket-in-ticket-out (TITO) facilities used to launder funds when used in conjunction with ATR machines (AGCs only) | Medium (2) | Medium (2) | Medium (4) | Increase in likelihood | Means of Payment | Scottish banknotes | Low (1) | Medium (2) | Low (2) | No change | Product | Gaming machines being used to launder criminally derived funds (AGCs only) | Medium (2) | Medium (2) | Medium (4) | No change |
Commission-controlled risks
| Vulnerability | Risk | Likelihood of event occurring | Impact of event occurring | Overall risk | Change in risk |
|---|---|---|---|---|---|
| Licensing and integrity | Arcade businesses being acquired by organised crime to launder criminal proceeds (AGCs only) | Low (1) | Medium (2) | Low (2) | No change | Licensing and integrity | Arcade businesses being acquired by organised crime to launder criminal proceeds (FECs only) | Low (1) | Low (1) | Low (1) | No change |
Case studies
Scottish banknotes
Scottish banknotes have been placed in machines with the potential aim of being paid out in English notes or by debit card. In one case, customers placed approximately £6,000 in Scottish notes into gaming machines in a premise.
Dyed notes
Several hundred pounds of stained notes were found in gaming machines located in an AGC.
Gaming machines
A Commission investigation found that a licensed operator did not have appropriate systems in place to monitor customer activity on B3 gaming machines, as the monitoring reports did not allow the operator to assess customers’ overall spend.
A customer employed by a cash-intensive business used cash to load a gaming machine, but after minimal play requested funds be paid back using their debit card.
References
1Industry Statistics - Annual report - Financial year April 2024 to March 2025 - Official statistics
2 Industry Statistics - Annual report - Financial year April 2024 to March 2025 - Official statistics
2026 money laundering and risks - Gambling software (remote and non-remote) Next section
2026 money laundering and risks - Society lotteries and external lottery managers (remote and non-remote)
Last updated: 30 July 2026
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