UKGC flags higher casino terror financing risk in new report

The Gambling Commission has published its 2026 assessment of money laundering (ML) and terrorist financing (TF) risks across Great Britain's licensed gambling sector, highlighting a more challenging compliance environment for operators as financial crime methods continue to evolve.

Drawing on intelligence and regulatory data collected between April 2023 and October 2025, the report evaluates the level of ML and TF exposure across different gambling sectors while identifying emerging threats that licensed businesses are expected to address through stronger compliance controls.

One of the report's most notable findings is the increase in the terrorist financing risk rating for casinos. While the UK's previous National Risk Assessment categorised casino terrorist financing risk as low, the Gambling Commission now considers the sector to present a medium level of risk based on more recent intelligence and operational evidence.

The regulator also places renewed emphasis on risks linked to artificial intelligence, cryptocurrency-related payment methods, illegal gambling operations and weaknesses in white label business arrangements.

Risk landscape continues to evolve

According to the Gambling Commission, licensed operators face increasingly sophisticated criminal activity that challenges existing anti-money laundering and customer due diligence procedures.

The regulator said advances in artificial intelligence have made identity fraud more convincing, allowing criminals to exploit weaknesses in verification systems through deepfakes, face swap videos and other AI-generated identity documents.

At the same time, illegal gambling websites continue to expand, creating additional risks for licensed operators that may unknowingly become exposed to illicit financial activity through business-to-business relationships.

The assessment has been prepared to support HM Treasury and the Home Office during future National Risk Assessments while also informing the Gambling Commission's licensing, supervisory and enforcement work.

Casinos remain among the highest-risk sectors

The report concludes that both remote and land-based casinos continue to represent some of the highest money laundering and terrorist financing risks within the regulated gambling market.

Betting operators also remain within the higher-risk category because of the size of the sector, transaction volumes and the variety of payment channels available.

By comparison, the National Lottery and society lotteries continue to be classified as low risk because of their different operating models and comparatively lower exposure to criminal misuse.

Although the Gambling Commission's revised terrorist financing assessment raises the casino sector from low to medium risk, the regulator did not suggest that licensed casinos are widely involved in terrorist financing. Instead, the updated classification reflects changing threat assessments and evolving criminal methodologies that require stronger preventative controls.

Peer-to-peer gambling receives increased scrutiny

The assessment identifies peer-to-peer gambling products as presenting particularly elevated money laundering risks.

Poker received a high money laundering risk rating across both online and land-based casino environments because players can transfer value between one another during gameplay, potentially making suspicious financial activity more difficult to detect.

Remote betting exchanges were also classified as high risk due to similar concerns surrounding customer-to-customer transactions and complex betting activity.

These products require enhanced monitoring and stronger customer due diligence procedures to reduce opportunities for financial crime.

Gambling software risk level increases

The Gambling Commission also increased the money laundering risk rating for the gambling software sector from low to medium.

The regulator explained that modern gambling technology supply chains increasingly operate across multiple jurisdictions, creating additional compliance challenges for software providers.

One concern identified in the report is the possibility that licensed gambling software could ultimately be supplied to unlicensed gambling operators through indirect commercial arrangements.

Technical infrastructure also remains an area requiring careful oversight.

Automatic ticket redemption systems and self-service betting terminals were highlighted as technologies that require effective monitoring to reduce opportunities for criminal misuse.

Payment technologies create new challenges

Payment methods continue to represent one of the most significant areas of regulatory concern.

According to the report, remote gambling businesses now rely on increasingly diverse payment options including e-wallets, prepaid cards and funds linked to cryptoassets.

While these payment methods provide greater convenience for consumers, they can also create additional opportunities for criminals seeking to obscure the origin of funds or move money through multiple financial channels.

The Gambling Commission noted that payment ecosystems involving several intermediaries or open-loop structures may make suspicious financial activity more difficult to identify.

As payment technologies continue to develop, operators are expected to ensure that their anti-money laundering systems evolve at the same pace.

AI-generated fraud is becoming more sophisticated

Artificial intelligence features prominently throughout the assessment.

The regulator warned that criminals are increasingly using AI tools to create realistic identity documents, deepfake videos and manipulated facial images capable of bypassing traditional customer verification processes.

These developments require gambling businesses to regularly review identity verification technologies and strengthen customer due diligence controls to maintain compliance with regulatory obligations.

Money Service Business activities remain under review

The assessment also examines casinos that operate Money Service Business (MSB) functions, including foreign currency exchange and cheque cashing services.

During 2024, approximately 3 percent of remote casino licence holders and 56 percent of non-remote casino licence holders offered MSB services.

The Gambling Commission estimated that total activity within these services reached approximately £70 million.

The report identifies several indicators that may warrant additional scrutiny, including repeated small foreign exchange transactions, dealings involving high-risk jurisdictions and situations where deposited and withdrawn currencies do not match.

While these indicators do not automatically suggest criminal activity, they may require enhanced monitoring and additional due diligence.

White label partnerships remain an area of concern

The Gambling Commission also identified operational weaknesses that continue to increase money laundering and terrorist financing risks.

Examples include insufficient anti-money laundering policies, inadequate staff training, ineffective transaction monitoring, poorly designed customer risk thresholds and limited oversight of linked customer accounts.

Particular attention was given to white label partnerships and wider business-to-business arrangements.

The report stated that some operators continue to apply “insufficient scrutiny” when assessing these commercial relationships, increasing the possibility that financial crime risks may not be properly identified.

The issue has also featured within wider government discussions concerning gambling regulation.

Although the Department for Culture, Media and Sport did not propose restricting legitimate white label partnerships during its consultation on unlicensed gambling sponsorship, it has proposed legislative measures that would make the promotion of unlicensed gambling operators a criminal offence under amendments connected to the Gambling Act 2005.

Illegal gambling remains a growing enforcement priority

The assessment also highlights continued growth within the illegal gambling market.

According to the regulator, unlicensed online casinos that accept cryptoassets may provide opportunities for organised criminal groups to move illicit funds outside regulated financial systems.

The Gambling Commission is increasing enforcement activity against illegal gambling with additional government funding of £26 million over the next three years.

The regulator also participates in the Department for Culture, Media and Sport's Illegal Gambling Taskforce, chaired by Baroness Fiona Twycross, Minister for Gambling, Museums and Heritage. The taskforce brings together regulators, gambling businesses, payment providers, technology companies and government representatives to strengthen action against unlicensed gambling activity.

Gambling market figures

The report also provides an overview of the size of Britain's regulated gambling market.

Between April 2024 and March 2025:

• Remote casino gross gambling yield reached £5 billion.
• Slot games generated £4.2 billion.
• Remote betting generated £2.6 billion.
• Non-remote betting generated £2.5 billion.
• On-course betting accounted for approximately £28 million.

The Gambling Commission assessed sector risks using its established methodology based on the combined likelihood of criminal activity occurring and the potential impact if vulnerabilities are exploited.

Conclusion

The Gambling Commission's latest assessment demonstrates that financial crime risks within the gambling sector continue to evolve alongside advances in technology, payment systems and organised criminal activity. While licensed operators already operate within one of the world's most heavily regulated gambling markets, the regulator expects businesses to strengthen customer due diligence, improve transaction monitoring and exercise greater oversight of commercial partnerships.

The report does not suggest that financial crime is widespread across the regulated industry. Instead, it reflects a precautionary approach that encourages operators to adapt compliance programmes as emerging threats develop. With artificial intelligence, cryptocurrency-related payments and illegal gambling continuing to reshape the regulatory landscape, maintaining effective anti-money laundering and counter-terrorist financing controls will remain a central priority for both operators and the Gambling Commission.

FAQs

What is the Gambling Commission's 2026 risk assessment?
The assessment evaluates money laundering and terrorist financing risks across Great Britain's licensed gambling industry using regulatory intelligence collected between April 2023 and October 2025.

Why did the casino terrorist financing risk increase?
The Gambling Commission concluded that evolving criminal methods and updated intelligence justify raising the casino terrorist financing risk from low to medium.

Which gambling sectors carry the highest money laundering risk?
Remote casinos, land-based casinos, betting and peer-to-peer gambling products such as poker and betting exchanges are considered among the highest-risk sectors.

Why are white label partnerships mentioned in the report?
The regulator found that some operators apply insufficient scrutiny to white label and business-to-business relationships, increasing compliance risks.

How does artificial intelligence affect gambling compliance?
AI can be used to create convincing fake identities, deepfakes and manipulated documents that may challenge existing customer verification procedures.

Why are crypto-related payments a concern?
Cryptoasset-linked funds and complex payment systems may make it harder to identify suspicious financial activity if operators do not maintain robust monitoring systems.

What are Money Service Business activities in casinos?
These include services such as foreign currency exchange and cheque cashing offered by some licensed casinos.

Why is illegal gambling a regulatory priority?
Unlicensed gambling websites may facilitate organised crime and operate outside the UK's regulatory framework, increasing financial crime risks.

How does the Gambling Commission assess risk?
The regulator applies a methodology that considers both the likelihood of criminal activity occurring and the potential impact if vulnerabilities are exploited.

Who uses the findings from the risk assessment?
The assessment supports the Gambling Commission's regulatory work and contributes to broader government risk assessments carried out by HM Treasury and the Home Office.