Gambling Commission data finds overlap between legal and illegal betting
New Gambling Commission research tracking real bank transactions suggests most punters who use unlicensed operators also keep betting with licensed ones, complicating a long-standing industry argument.
New research from the Gambling Commission indicates that consumers who repeatedly use unlicensed gambling operators in the UK largely continue to use licensed ones as well, a finding that challenges assumptions held across the regulator and the wider industry.
The study, discussed on SBC News' iGaming Daily podcast, analysed bank transactions from a sample of UK consumers, covering 3,426 transactions across 179 individuals.
SBC Media Editor Ted Menmuir told host Charlie Horner that the standout figure was the overlap between the two markets: 91% of people with repeat detected transactions on unlicensed sites were also found to be gambling with licensed operators.
Menmuir said that finding undermines the notion that turning to the black market means consumers abandon the regulated sector altogether, an argument operators have made for years when warning against tighter restrictions on licensed products.
SBC News Editor Ted Orme-Claye agreed the data was significant but said it does not fully discredit the industry's position that some consumers are actively drawn to unlicensed sites rather than simply using them alongside licensed ones.
Orme-Claye highlighted the risk profile within the sample, noting that 45% of those scoring eight or more on the Problem Gambling Severity Index were found to be transacting with the illegal market.
That suggests problem gamblers form a core part of the customer base for offshore operators, he said, adding that some of these individuals may be self-excluded players specifically targeted by so-called non-GamStop brands.
Both Menmuir and Orme-Claye acknowledged the limitations of the research, including the small sample size and methodological constraints, but Menmuir argued the findings remain valuable because they track actual transaction data rather than relying on consumer surveys.
The pair agreed that the next step should be research into why consumers use unlicensed operators in the first place. Orme-Claye said blocking payments to illegal sites on its own will not address the underlying drivers of the behaviour.