The British Gambling Commission (BGC) has taken a major step by elevating the terrorist financing (TF) risk level associated with casinos to medium. This change is part of the commission’s 2026 risk assessment on money laundering (ML) and TF vulnerabilities within the UK’s licensed gambling sector. Covering data from April 2023 to October 2025, the report categorizes risk profiles across various verticals and details specific vulnerabilities. The assessment serves as a key input for the National Risk Assessment of Money Laundering and Terrorist Financing, conducted by HM Treasury and the Home Office.
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Technological Advances Challenge Due Diligence
The commission’s report underscores the rapidly evolving risk market in the gambling sector, with technological advancements — particularly in artificial intelligence — testing the efficacy of existing customer due diligence controls. Illegal gambling websites further compound the issue, exposing operators to potentially illicit financial flows in their business-to-business dealings. The commission has highlighted both remote and non-remote casinos, along with betting operations, as carrying the highest risk profiles. In stark contrast, the National Lottery and society lotteries are categorized as low risk. The report also flags poker and peer-to-peer betting exchanges as highly susceptible to ML risks, with poker receiving a “high” rating in casino environments. The gambling software sector has been upgraded from low to medium ML risk, reflecting its cross-border nature and the potential misuse of licensed software by unlicensed operators.
Payment Methods and Technological Vulnerabilities
Payment methods remain a major focus in assessing ML and TF risks. The increasing use of e-wallets, pre-paid cards, and cryptoasset-linked funds, especially in remote gambling, raises red flags. Complex payment systems and open-loop structures are seen as offering criminals viable concealment methods. The commission’s report also warns of growing sophistication in attempts to bypass customer due diligence measures, noting the use of deepfakes and other AI-generated fraudulent identity materials. Casinos offering Money Service Business (MSB) functions, such as foreign currency exchange and cheque cashing, are particularly vulnerable. There were an estimated £70 million in transactions linked to these services in 2024. Indicators of ML risk include frequent small foreign-exchange transactions and dealings with high-risk jurisdictions.
Risks in White-Label Partnerships and Illegal Gambling
Operator shortcomings remain a major contributor to the elevated risk levels, according to the BGC. Weak anti-money laundering (AML) and counter-terrorist financing (CTF) policies, poorly trained staff, and inadequate monitoring are key areas of concern. White-label partnerships and business-to-business relationships were highlighted as specific risk factors, with the report criticizing the lack of adequate scrutiny in these arrangements. The report reveals a rising concern over illegal gambling, particularly in unregulated casinos that accept cryptoassets — often seen as conduits for organized crime. Between April 2024 and March 2025, remote casino gross gambling yield reached £5 billion, with slot games alone contributing £4.2 billion. The BGC employed a “likelihood x impact = risk” formula in its vulnerability assessments.
Increased Enforcement and Future Steps
The commission is ramping up its enforcement activities against unlicensed gambling operations, bolstered by a new £26 million funding allocation over the next three years. It’s also collaborating with the Department for Culture, Media and Sport’s new Illegal Gambling Taskforce. But chaired by Baroness Fiona Twycross, the taskforce includes experts and stakeholders from the gambling sector, tech platforms, and government departments. Next on the commission’s agenda is the release of the full evidence underpinning financial risk assessments. This information is expected to provide further insights into the commission’s decision-making process regarding risk levels and enforcement priorities.
Garry Sputnim is a seasoned journalist and storyteller with over a decade of experience in the trenches of global news. With a keen eye for uncovering stories that resonate, Alex has reported from over 30 countries, bringing light to untold narratives and the human faces behind the headlines. Specializing in investigative journalism, Garry has a knack for technology and social justice issues, weaving compelling narratives that bridge tech and humanity. Outside the newsroom, Garry is an avid rock climber and podcast host, exploring stories of resilience and innovation.
