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.
20 - Illegal markets
This risk assessment is focused on the risks present in the licensed gambling industry, however the National Risk Assessment of Money Laundering and Terrorist Financing (opens in new tab) (PDF) (the NRA) identified the money laundering (ML) and terrorist financing (TF) risks posed by illegal gambling. The NRA noted that there has been an increase in illegal casinos targeting the UK. Illegal gambling can both generate proceeds of crime and be used to launder the proceeds of crime.
Illegal gambling sites are not supervised by the Gambling Commission, nor do they comply with the regulatory framework in place, which includes the Licence Conditions and Codes of Practice (LCCP) and the Money Laundering and Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (opens in new tab). The lack of regulation allows high-value activity to be conducted without the necessary oversight and reporting procedures. Illegal gambling sites are vulnerable to exploitation for ML and TF purposes, and they undermine the integrity of the gambling industry.
Gambling sites can also be established and operated by organised crime groups using their proceeds of crime, as has been identified in Southeast Asia where illegal online gambling platforms have been used by transnational organised crime groups to disguise illicit financial flows1.
Payment service providers act to facilitate the transfer of funds from British consumers to illegal sites. The payment processors are the first regulated financial link through which funds from illegal gambling are filtered into the legitimate financial system.
Illegal gambling sites also increasingly allow the use of cryptoassets as a means of payment. Cryptoassets carry heightened ML and TF risks due to the potential exposure to high-risk jurisdictions, including sanctioned entities; their ability to move high volumes at speed; regulatory gaps that make it possible for users to remain anonymous, as well as anonymity enhancing services; and their association with criminal activity.
To tackle this threat, HM Government has allocated £26 million over 3 years to the Gambling Commission to intensify its focus on disrupting the illegal gambling markets, utilising new powers and working in close collaboration with partner agencies to attack illegal activity across the supply chain. While this enhanced enforcement targets unlicensed operations, a compliant, mature and resilient regulated industry serves as a critical baseline defence. By strictly adhering to statutory safeguards and reporting concerns, and maintaining rigorous transaction oversight, the regulated sector minimises exposure to ML and TF, effectively mitigating risk displacement and safeguarding the broader economy against vulnerabilities identified by the Financial Action Task Force (FATF).
Further information can be found in the Commission’s publications on tackling illegal gambling.
References
1United Nations Office of Drugs and Crime ‘Transnational Organized Crime and the Convergence of Cyber-Enabled Fraud, Underground Banking and Technological Innovation in Southeast Asia: A Shifting Threat Landscape’ (opens in new tab)(PDF), October 2024.
2026 money laundering and risks - Proliferation financing
Last updated: 30 July 2026
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