More than one in four gambling websites are considered high or critical risk, according to new analysis from ScamInfo.ai, with the sector unsurprisingly emerging as one of the most dangerous categories across the internet.
The cybersecurity platform analysed 7,185 websites spanning more than 40 online sectors and found that gambling and betting accounted for 34.7% of all critical-risk websites identified in the study.
Of the 591 gambling domains analysed, 6.9% received a critical risk rating and a further 19.5% were classified as high risk, while only two websites (0.3%) achieved a trusted rating.
The findings show gambling websites significantly underperform the wider internet in terms of online safety indicators.
Across ScamInfo.ai’s full dataset, around 70% of websites received a low-risk rating, but within gambling, fewer than half (46.7%) met that threshold.
The gambling category also recorded an average risk score of 35.8 out of 100 – almost double the overall average of 18.4.
ScamInfo.ai said the findings reflect the prevalence of unlicensed and fraudulent operators operating alongside regulated gambling brands, particularly during major sporting events when betting activity typically increases.
A detailed review of 10 gambling websites found that eight lacked basic legal documentation, including Terms and Conditions, Privacy Policies or contact pages.
Six returned no publicly available WHOIS ownership data, making it difficult to verify who operated the websites or when they had been established.
Black market: adding more risk to gambling
It comes as no surprise to many within the industry, given the recent dominance of unlicensed operators in the sector, which seem to be acquiring more and more customers in recent years.
While regulated operators are not without fault, with many being fined or warned for reasons not limited to KYC, advertising and AML regulatory breaches, the prominence of the black market has begun to tarnish the reputation of the gambling sector even further.
A recent study commissioned by Flutter Entertainment showed that unlicensed operators in the UK were allowing players to bet on their sites despite having restricted themselves via GAMSTOP.
There were also issues raised throughout this study regarding the lack of ability to withdraw funds from certain accounts after winning money.
Although the research found elevated cybersecurity risks within the gambling sector, it stressed that consumers should distinguish between regulated operators and unlicensed offshore websites – an urge which has also come from regulators and licensed operators alike.
The report recommends that consumers verify an operator’s licence directly through the relevant regulator before opening an account, review domain history, ensure legal documentation is readily available and understand withdrawal conditions before depositing funds.
However, how plausible this is is up for debate. Punters who check whether the site they are using is licensed by said relevant regulator is minimal.
A study in late 2022 found that only 10% of players in Sweden were able to accurately identify a licensed operator.
Moreover, some players are regularly choosing unlicensed platforms due to their belief that they are more likely to get better odds, or have more of a chance of playing games unavailable in their region.
It is highly unlikely that a run-of-the-mill gambler will be cross-referencing the platform on which they are betting to verify whether or not it is a licensed operator – a sentiment shared by Entain’s Chief Customer Care Officer and General Counsel, Simon Zinger.
According to Tim Miller, Executive Director of Research and Policy at the UK’s Gambling Commission, Big Tech companies also have a part to play in ensuring players aren’t using these sites – and are therefore at less risk of scams.
“Everything that I have seen particularly over the last couple of years is that they [Meta] only act when they’re really pushed,” he told the iGaming Daily Podcast.
“In fairness, when we refer illegal sites to them and illegal ads to them, they take action to take them down. Fantastic.
“But actually, the harm has already started happening there. What we’re not seeing is them being sufficiently proactive to stop those kinds of routes to the illegal market appearing in the first place.”
With regulators globally continuing to warn consumers about the growth of offshore gambling websites and fraudulent operators seeking to exploit them, it seems it is not a sufficient and all-encompassing route to player protection.
It will come as no surprise to those in the industry that consumers on the black market are of critical risk, but, yet again, it hammers home the point that a clear plan needs to be put in place to ensure punters are gambling with as little exterior risks as possible.
