Reports warn of illegal market advance and economic impact
Concern about the growth of the illegal betting market is gaining strength globally, driven by new studies revealing million-dollar losses, weakening regulation, and greater exposure of vulnerable consumers.
The illegal market far exceeds the regulated one in the European Union
A report by Yield Sec, commissioned by the European Casino Association (ECA), estimated that the grey and black market within the European Union reaches €80.6 billion in annual GGR, more than double the size of the regulated sector.
The report warns of a highly sophisticated underground ecosystem that operates without controls and continues to attract players with increasingly aggressive strategies.
Australia loses billions annually to offshore operators
A similar study conducted by H2 Gambling Capital for Responsible Wagering Australia (RWA) estimates that the country loses AU$3.9 billion (GBP £1.9b) annually due to illegal platforms.
The projection for 2029 raises that number to AU$5 billion, highlighting a worrying growth curve.
Clandestine advertising and targeting of vulnerable users
According to Yield Sec, illegal operators take advantage of regulatory gaps, weak protection mechanisms, and digital anonymity to specifically target minors and players at risk.
Detected practices include:
- Imitation of regulated brands, using their logos and aesthetics.
- Social media campaigns aimed at vulnerable groups.
- Use of personal data to segment addictive profiles and offer aggressive bonuses.
In Australia, RWA CEO Kai Cantwell agreed on the seriousness of the problem: “While licensed operators use data to protect players, illegal sites use it to target minors and people at risk.”
The Australian report also revealed that half of offshore users had previously tried to self-exclude through the national BetStop registry.
Million-dollar fiscal losses for States
The economic impact is equally alarming. Yield Sec calculates that, with an average tax rate of 25%, the 27 EU countries lose more than €20 billion per year in revenue, money that should fund public services, sports, and culture.
The ECA president, Erwin van Lambaart, was categorical: “Every euro that goes to illegal operators is a euro stolen from European citizens and regulated companies.”
In Australia, the State could lose almost AU$2 billion in revenue over the next five years, in addition to AU$800 million in sports and racing contributions.
Why players migrate to the illegal market
The reasons driving users to bet offshore are repeated in both studies:
- Better odds (48% of respondents in Australia)
- More attractive bonuses (44%)
- Live betting, prohibited in the regulated Australian market
For RWA, the conclusion is clear: the legal market must be competitive to retain users. “If the player does not find the product or price they are looking for here, they don’t stop betting: they simply go offshore,” Cantwell stated.
Recommendations to curb the advance of the illegal market
The H2 Gambling Capital report proposes several measures:
- Create a National Illegal Operators Listing Platform (NIGBP).
- Integrate BetStop with payment monitoring systems, blocking transactions to sites included in the NIGBP.
- Unify the regulatory framework at the federal level to close gaps that currently allow clandestine operation.
Cantwell concluded that a solid national system not only protects players but also preserves sports funding and prevents tools like BetStop from being circumvented by unregulated operators.
Tags: Europe, Illegal casinos, illegal betting market, Yield Sec, H2 Capital, NIGBP, BetStop