Gambling Commission Study Links Illegal Sites to Problem Gambling

A Gambling Commission study found a strong association between illegal gambling and gambling-related harm among UK consumers. The regulator reported that 45% of individuals transacting with illegal operators had a Problem Gambling Severity Index (PGSI) score of eight or more.

What Happened

The Gambling Commission conducted a study examining customer transactions with both legal and known illegal gambling sites, revealing a significant disparity in Problem Gambling Severity Index (PGSI) scores. According to the Gambling Commission website, 45% of individuals who transacted with illegal operators recorded a PGSI score of eight or more. This contrasts sharply with the 6% of individuals transacting with legal companies who achieved the same score.

Furthermore, the study, as reported by the Gambling Commission, indicated that an additional 16% of those interacting with illegal operators had a PGSI score ranging from three to seven, compared to 8% among those using legal platforms. This higher prevalence of transactions with illegal operators among individuals with elevated PGSI scores may be attributed to self-excluded customers seeking out non-Gamstop sites to bypass regulated market restrictions, according to SBC News.

Key Details

• The Gambling Commission’s study reported that 45% of individuals transacting with illegal operators had a PGSI score of eight or more, compared to 6% among those using legal companies (Gambling Commission website).
• An additional 16% of those gambling with illegal operators scored between three and seven on the PGSI, versus 8% for legal site users (Gambling Commission website).
• The study involved a sample size of 179 individuals’ transactions, with PGSI scores available for 146 participants, primarily male with an average age of 44 (SBC News).
• The Commission found that 91% of individuals who transacted with illegal gambling firms also simultaneously engaged with the legal sector, indicating a substantial overlap (Gambling Commission website).

Why It Matters

The Gambling Commission’s findings reinforce ongoing concerns within the industry regarding the growth of unlicensed gambling and its association with harm. Dan Waugh, Partner at gambling advisory Regulus Partners, stated that while the study’s sample size is small, its results align with broader research indicating a higher likelihood of harm among individuals using black market platforms, as reported by SBC News.

The consistent transaction patterns observed with unlicensed operators suggest that once a customer engages with such sites, they tend to continue, with an average of 4.9 transactions in the first month, according to the Gambling Commission website. This presents a challenge for the regulated industry, which faces increasing regulatory pressures, including Financial Vulnerability Checks and Financial Risk Assessments, and higher tax rates such as an increased Machine Games Duty to 25% (SBC News).

A spokesperson for Flutter UKI, operator of Paddy Power, Betfair, and Sky Bet, told SBC News that these figures underscore the importance of government and regulators addressing the illegal market. Furthermore, the substantial overlap, with 91% of illegal site users also gambling within the legal sector, highlights that individuals struggling with problem gambling continue to use regulated platforms, suggesting a need for sustained attention from the legal industry (Gambling Commission website).