The UK government has increased the money laundering risk rating for the casino sector from low to medium. This decision was made due to the growing complexity and volume of financial activities on remote gambling platforms, as criminal tactics evolve to bypass current protections. Black market operators continue to be a significant concern despite ongoing efforts to mitigate their impact.
The 2025 National Risk Assessment (NRA), released by HM Treasury, highlights that remote casinos are particularly vulnerable within the gambling ecosystem. Challenges such as increased customer anonymity, cross-border fund movements, and new technologies contribute to rising compliance issues. Authorities noted a significant rise in suspicious activity reports (SARs) from the sector, with a 26% year-on-year increase, and a surge of illegal online gambling sites targeting UK citizens.
The Treasury’s report identifies several emerging threats, such as the use of virtual private networks (VPNs), prepaid cards, third-party transactions, and the misuse of white-label arrangements, which have previously lacked sufficient oversight. Peer-to-peer poker and crash games, especially within crypto casinos, also pose potential channels for criminal activities and money laundering.
According to the HM Treasury report, money laundering in licensed casinos often involves the recreational spending of criminal property. However, there are instances where criminals attempt to ‘clean’ funds through casinos.
Casinos offering money service business (MSB) services, such as foreign currency exchange and third-party cheque cashing, represent another potential vulnerability. Although fewer operators provide MSB services compared to 2020, the remaining businesses reportedly attract higher-risk customers and involve complex transaction chains linked to high-risk jurisdictions.
The HM Treasury report emphasizes ongoing vulnerabilities in customer due diligence (CDD), especially in non-remote casinos where transaction thresholds may not prompt additional scrutiny. Alarmingly, compliance with enhanced due diligence (EDD) among operators has decreased, with 41% of casinos inspected in 2024 found to be incorrectly applying EDD.
The report notes that casinos, like other sectors, face increasingly sophisticated attempts to bypass CDD checks using false documents, sometimes generated by Artificial Intelligence (AI).
Although the risk of terror financing remains low for the sector, the Treasury stresses the importance of full compliance with mitigation requirements due to the industry’s mix of local and foreign customers, including politically exposed persons (PEPs) from higher-risk jurisdictions.
Meanwhile, the UK Gambling Commission continues to address illegal casinos through rigorous enforcement actions and digital shutdowns. Between April 2024 and March 2025, the regulator issued over 1,100 cease-and-desist notices and removed 81,000 web links related to illegal casino activities. However, the increase in online gambling and the advent of cryptoassets and AI-generated identities necessitate ongoing vigilance and regulatory adaptability.
- SCCG Management. The Gambling Industry’s Global Connector. Access Here.
- Source: SCCGManagement.com