Major Payment Processors Found Linked to Illegal Casinos

According to a new study in the United Kingdom, major payment processors, including Mastercard and Visa, are responsible for processing payments related to illegal gambling websites. Many of these sites are responsible for defrauding consumers out of thousands of pounds.

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Known as offshore casinos, these gambling operators do not work within the confines of UK laws and regulations. They are accessed through the internet and do not always have the normal consumer safeguards. More worrying is that they do not apply responsible gambling practices.

Across the world, countries and states are trying to adapt their online gambling laws. This has mainly been down to the advent of digital sportsbooks and casinos. Go too lax, and these countries risk social problems related to problem gambling. Yet if they are too strict, customers turn to these offshore providers instead of ones that pay tax revenue.

Italy is one country currently overhauling its laws. There is a wide range of great providers and third-party reviewers working in the country who will find the best online casino in Italy for customers. Many of these have generous bonus codes, which they have used to build a thriving industry in the country. In December, it launched a new licensing regime, aimed at overhauling its laws and bringing Italian customers back to home-grown casinos.

The study looked at nine sites that offered offshore sports betting and casinos to customers. These sites did not have a gambling license to operate in the United Kingdom. However, they do appear in search results. These sites had cryptocurrency listed alongside Mastercard as a payment method. Visa was offered on two of the sites, suggesting that they both receive fees and service charges from any transactions made.

Conducted by Investigate Europe, the organization is a cross-border site that touts itself as providing journalism for Europe. Very often, they investigate reports not shown in mainstream media. Last week, they also uncovered links between a major betting company and many of these blacklisted sites.

Problems arising from these blacklisted sites and the consumer complaints are endless. People have reported having their accounts deleted when they attempt to withdraw winnings. Many people have just been refused their winnings outright, including one person who could not take £6,000 from their account. In the two years running up to December, there were around 922 complaints about unlicensed operators to the watchdog.

Since 2014, both Mastercard and Visa have been in an agreement with the gambling commission, which stated they would block payments to these sites. However, in these instances, they were in blatant disregard of their commitment to prevent the use of their gateways for criminal activity.

When asked, Mastercard said that it is the bank's responsibility to ensure merchant compliance and establish if illegal or not. It added that it had no direct relationship with the sites, but would investigate the matter further. Visa also gave a similar response, adding that it invests heavily in technology to monitor this.

There have been several major figures within the gambling industry who have said a united front needs to be made to prevent offshore gambling sites. One of the most prominent has been Play'n GO, developers of online casino games and systems. Paresh Rughan, Head of Compliance, believes they pose a bigger threat to the sector than anything else, but that it can be combated.

He names it the 'shadow gambling' sector. In an interview, he remarked, "They're getting away with unregulated, unlicensed gambling without the use of deposit limits, colling off tools. They also don't pay tax," but he added that most worringly, they are getting better at hiding it.

One lingering sentence is that "The reach of the regulator ends at the border, but the reach of these tools does not". This is in reference to these companies often basing themselves in places where authorities can not act. Even attempts to block them are futile due to technology such as VPNs.

He believes that the key is education, because many consumers do not realize they are using illegal sites. Many will even have the same compliance jargon, such as responsible gambling and fair play, and small print. Yet when people come to withdraw money, have an issue, or feel they may suddenly have a problem with a gambling issue, the sites become hard to reach.

This may be the only way that these sites can actually be combated. If major providers like Mastercard and Visa are having problems finding them using their own tech, it seems that this way to prevent them is not the answer. Instead, it may take a more human approach: one of education and awareness.