ILLEGAL GAMBLING
the relatively onerous processes and procedures put in place by regulated operators who are required, under the terms of their license, to do so; • Some black market sites offer games that are popular but uncertified or unlicensed; • A proportion of customers when accessing and playing on an online gambling site are oblivious to the differences between regulated and black market sites; • Black market sites are often marketed via social networking platforms which are increasingly used by all demographics for example Facebook, Telegram, Whatsapp and Instagram; • Due to technological advancement, in particular artificial intelligence, black market sites can find customers as opposed to customers finding online gambling sites; • Technological advancement also allows customers to circumvent any restrictions put in place by local authorities and Internet Service Providers. It is correct that an online gambling licensing regime will, by its very nature, place certain restrictions and requirements on players and operators alike. Regulators should however consider how to ensure a degree of social responsibility oversight, control and protection which is not so onerous that it, by virtue of its obstacles, increases the flight of legitimate customers to the black market. In this regard technology and operator-experience could assist, and this is also addressed more fully below. Black market size, intervention and regulatory confusion Rationally, one would expect all regulators to invest resources to understand the size of the black market in their respective territories. In reality this is not happening, and there are several examples recently of regulators suggesting that the black market in their territory is significantly less than the reality, when compared with other compelling statistical and empirical evidence. Reasonably, one would expect all regulators to try to minimize the size of the black market in their respective territories, but this is only occurring in some jurisdictions, and to different extents. Considering the dual primary purpose of ‘responsible’ regulation i.e. the protection of customers and plumping the
fiscal coffers, it does raise the question as to ‘why?’.
Here are some possible and plausible reasons:
1. Regulators do not have the resources to properly understand the size of the black market; 2. Regulators are concerned that reliable empirical evidence on the actual size of the black market, considering their raison d’etre is, will cause public and administrative embarrassment and highlight their inability to disrupt unlicensed operators; 3. Politicians, regulators and government have interests in protecting local monopolies, often lotteries, rather than regulated online gambling providers. The fickle role of politics Earlier we mentioned that, alongside regulators, politicians and legislators also bear responsibility for the increasing omnipresence of the black market. The regulation of gambling products will always be a divisive topic amongst any electorate, especially that of online gambling. Land-based gambling is less contentious arguably because of historical links between land-based casinos and political interests. This applies similarly to lotteries. Based on a belief, mistaken or not, that online gambling is ‘evil’ because technology enables it to reach so many potential customers, politicians attempting to garner votes, refuse to add anything but restrictions of online gambling products to the lawmaking timetable. It is significant that gambling is commonly viewed as a ‘sin’ product and unpopular, to say the very least, with abolitionists and those of a more conservative slant. Either because land-based casinos and lottery products are being protected, or because the regulation of online gambling is too politically dangerous, the dangers of the black market are not laid bare in political debate, nor by extension are the issues of the lack of consumer protection and the flight of fiscal revenue offshore. Such political expediency is therefore an enabler of the black market. How to minimise the black market
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IMGL MAGAZINE | DECEMBER 2024
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