RG expert: Regulating affiliates would stem black market activity

Deal Me Out consultant Ciaran Henry called on the industry to regulate affiliates and punish those firms driving UK players to the black market.

Pressure is continuing to grow against affiliates that promote unlicensed operators to UK-based consumers, with platforms linking to ‘not on GAMSTOP’ online operators continuing to crop up.

A Google search for ‘Not on GAMSTOP’ this week has shown more than four million results, with self-excluded consumers looking to circumvent bans and continue to gamble.

In the UK, operators and suppliers are both required to be licensed by the Gambling Commission. Affiliates have remained outside of the regulator’s scope from a licensure perspective.

Gambling Commission CEO Andrew Rhodes did warn operators in May 2024 to terminate relationships with affilaites should the third-party also be promoting black market sites.

At the time, the CEO said: “We are increasingly engaging with our licensees if we discover their affiliates have placed adverts on illegal sites. Ensuring licensees terminate business relationships with affiliates who facilitate illegal gambling.”

Speaking on a panel session during Deal Me Out’s Black-Market conference on Monday, Henry was asked what the process and penalties should be for affiliates found guilty of targeting players in regulated markets to unlicensed sites.

The former PokerStars senior safer gambling specialist called for a greater understanding of affiliates from the industry,

noting a lack of knowledge of that particular sector is part of the problem and has made it harder to regulate.

He added that until the sector is properly governed, “sweeping policies” would continue to fail and let vulnerable consumers be pushed towards illegal offerings.

Henry said: “An area the entire industry needs to look at is the relationship we have with affiliates. How do we penalise bad affiliate behaviour, especially when they are dealing with regulated customers?

“Any affiliate found to be reputable should be regulated, like any other marketing corporation or B2B relationship. They should be licensed.

“They should be scrutinised, should be adjudicated and anyone found to be [doing business with unlicensed operators] should be hit with very high fines.”

Henry’s comments come after the head of the Spanish regulator, Mikel Arana, called for operators to only work with affiliates “that offer their brands exclusively to legal channels”.

Arana was speaking at ICE in January, with pressure from the regulated sector having ramped up against affiliates prior to the trade show being held.

Speaking to EGR in September last year, LeoVegas Group CEO Gustaf Hagman said licence requirements for affiliates would go some way to staving off black market growth but that it wouldn’t act as a silver bullet.

A Betting and Gaming Council-commissioned report, published by consultancy firm Frontier Economics, claimed last September that £4.3bn was being staked on the UK black market each year.