UK Gambling Commission Open Banking Study Finds 91% Overlap in Licensed and Illegal Gambling Activity

The UK Gambling Commission has released payment data that tracks spending on unlicensed operators through open banking rather than surveys. The report, published on 28 October, shows that among people with repeated detected payments to illegal sites, 91% also gambled with licensed operators. Licensed transactions did not fall substantially after the first illegal payment.

This pattern indicates illegal gambling is added to licensed play instead of replacing it. The Commission links unlicensed activity to far higher problem gambling scores than those seen among customers of regulated sites. Searches for sites "not on GamStop" remain a primary entry route, per the regulator's Phase 3 Consumer Voice research released on 20 October 2026.

Overlap in User Behavior and Market Entry Points

That Phase 3 survey covered 4,007 people who had gambled online in the previous four weeks, with fieldwork between 1 and 15 May 2026. The open banking study itself rests on a narrow base: a payment firm's categorizer flagged transactions with over 50% gambling probability, while excluding cryptocurrency and capturing only some illegal operators. According to reporting by Casino Beats, Next.io and iGaming Express, the data cannot measure the illegal market's size or prove that such sites cause harm.

Evidence Limits Ahead of April 2027 Duty Rise

The findings arrived during Budget week as the sector absorbs an online gaming duty of 40% in place since April 2026. The Betting and Gaming Council has tied these costs to black market growth. Its chief executive Grainne Hurst argued higher taxes on the regulated sector will make the illegal market more attractive since it pays no UK tax and offers no licensed safeguards. Citing H2 Gambling Capital projections shared by the Betting and Gaming Council, more than one in every five pounds staked online could reach illegal operators by 2031, with a 25% rate potentially putting almost 9,000 jobs at risk and nearly 1,000 betting shops and casinos at serious risk of closure.

The Commission cautions the panel data is not nationally representative. As the general betting duty moves to a higher rate in April 2027, the overlap shown in the 91% figure leaves both operators and regulators without a settled view on whether tax policy or targeted enforcement on GamStop searches will more effectively contain illegal activity and associated harm.