The UK’s largest gambling trade group claims that the black market has increased dramatically in size over the past few years, as the country’s regulator attempts to bolster its forces in the face of an increasingly threatening illegal sector.
According to new data released today by the Betting and Gaming Council (BGC), as much as £16.6bn is being staked with illegal operators by British consumers.
That represents more than a threefold increase since 2019 and a doubling of black market gambling over the past two years, the BGC said.
The research, conducted by H2 Gaming Capital, suggests that offshore gambling has climbed from £5bn in 2019 up to £16.6bn in 2025.
The UK trade group has also pointed to a report it commissioned from marketing intelligence firm WARC, which shows that illegal operators now account for almost half of UK advertising spend.
According to that research, the total UK gambling advertising market will be worth around £1.9bn this year, but around £800m of that spend is coming from operators who do not have a local licence, the BGC said.
Researchers also noted that while the regulated industry is projected to shrink its advertising spent by 9.2 percent this year, illegal operators will grow their marketing investments by 32 percent.
Responding to the surging threat of black market operators, the UK Gambling Commission is now recruiting for a Head of Illegal Markets.
The newly created position will lead the regulator’s renewed charge against the offshore industry, leading enforcement investigations and devising strategies to restrict the apparent surge in unlicensed gambling reported by the BGC.
The job is described as a “high-profile position with frequent exposure to external stakeholders”. At “only” £65,000, the role of a potential illegal markets czar has come in for criticism from industry talking heads, who believe the salary is too low to attract a candidate who will truly have the skills to effectively disrupt the black market.
Industry pushback
After years of dismissing the black market as a negligible factor in the UK, the Gambling Commission has spent the past 18 months attempting to deepen its understanding of the sector.
It has produced research trying to understand why consumers leave the regulated market. Common motivations include attempting to dodge self-exclusion and a desire to wager with cryptocurrencies.
However the commission has resisted calls to develop an official view on precisely how large the black market is, space which the BGC is happy to fill.
Armed with this evidence of a surging black market, the trade group is strengthening its push for a slowdown in regulatory pressure on the licensed sector.
“What we are seeing is a harmful black market scaling up at pace,” said BGC chief executive, Grainne Hurst.
“Illegal operators are becoming more sophisticated, more visible and more aggressive in how they reach UK customers. That should concern anyone who cares about consumer protection.
“The choice for policymakers is clear. If the regulated sector becomes harder to use or less competitive, customers will not stop betting, they will simply go elsewhere,” she said.
In particular, the BGC wielding its research against the potential introduction of financial risk assessments, something the trade group has consistently opposed.
The Gambling Commission maintains that the checks, which are still in the latter stages of a lengthy pilot, will be frictionless for the vast majority of consumers.
In an April update, the regulator said it was still considering whether or not to actually introduce them, but the BGC’s perspective is very clear.
Hurst said that the growth of the black market, “is why financial risk assessments must either be genuinely ‘frictionless’ or not introduced at all – because anything else will push customers out of the regulated market”.
Damned statistics
The gambling industry has repeatedly pointed to a wave of regulatory tightening, which began with the 2023 government White Paper, as a key factor in driving players to black market.
However new research from the National Institute of Economic and Social Research (NIESR) suggests that while the still ongoing project of regulatory reform may have made life harder for gambling operators, it has not had a huge impact on the economy.
The NIESR notes that the industry has suffered a £812m decrease in gross gambling revenue, but argues most of that consumer spending has been redirected into other areas of the economy.
Gamblers are instead spending their case on essentials like food and debt repayment, with the net hit to the economy sized at only £189m, it said.
That appears to clash with the BGC’s reported black market figures, which would require more than the NIESR’s £189m in lost economic revenue channeled exclusively offshore to generate the apparent £8bn increase in black market wagering reported since 2023.
Whatever the true scale of the UK’s black market, there’s every reason to believe that its market share will have increased since the period covered by both the H2 and NIESR figures.
Taxes for online casino games increased to 40 percent of gross gambling yield (GGY) in April, with rates on remote betting due to rise to 25 percent next year.
The Office for Budget Responsibility has predicted that GGY will decline by around a third as a result of tax increases and that decreases in marketing spend, alongside other factors, could drive more players offshore.
