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A daily podcast delving into the biggest stories of the day throughout the sports betting and igaming sector.
Charlie Horner (00:04.835)
Welcome back to iGaming Daily, supported by Optimove, the creator of Positionless Marketing and the number one player engagement solution for sports betting and iGaming operators. Today we have a very special guest with us, as me and our editor at large, Ted Menure, are joined by the UK Gambling Commission's executive director, Tim Miller. It's been a very busy time at the Gambling Commission recently, not least as the UK continues to battle against the black market.
Tim Miller (00:09.775)
Yeah. you
Charlie Horner (00:33.945)
As we know, more UK consumers are being exposed to illegal gambling sites and it's part of the Commission's job to lead the fight in reducing that exposure. So, as the government gives more funding for the fight against illegal gambling, what are the Commission's plans and how confident can the regulated sector be that this is a battle that can be won? Tim, thanks ever so much for joining us today. How how are you doing?
Tim Miller (00:59.61)
Good, no, thrilled to be here. Thanks for inviting me.
Charlie Horner (01:02.565)
Fantastic. So it's great to have you on the show. Ted, how how are you today? You looking forward to this one?
Ted (01:08.322)
Well, yes, yes, very much so.
Charlie Horner (01:12.069)
Very good. Okay, Tim, let's let's dive into things. because we know the the battle against illegal gambling is is sort of at the top of the agenda in twenty twenty six. So I guess the first question is really how serious is the illegal gambling threat today, maybe compared with say five years ago, or perhaps before the pandemic?
Tim Miller (01:34.725)
Yeah, I mean, I think certainly it has changed over the last few years, in large part because of the way technology develops. know, I think we've seen, particularly in the news over even the last few days, how, you know, governments, parents and others are increasingly worried about the impact that the online world can have on people. I think gambling is no different in that respect. The sort of technologies that we've seen develop, you the way that social media is used, the way that
kind of actually money can flow much more easily in many respects than it did a few years ago, does mean that the threat from the illegal market has changed. And I think that's something that is certainly not unique to the UK. You you talk to jurisdictions all around the world and they're facing exactly the same challenges. And I think that what that means is that all of us with the role to play in ensuring that, you know, gambling is fair and safe.
do need to take it seriously and need to work together to address those risks.
Charlie Horner (02:35.234)
Mm. Yeah, I think I think collaboration on on that kind of front book across multiple agencies will will probably be the best way forward to to really get on the front foot in this. but there's plenty of estimates out there for how big the black market is. there's there's plenty of different estimates and they all have different answers to how big the black market might be. d do we actually know how big the black market is in the UK and how do we know if we can trust any estimates?
Tim Miller (03:04.442)
Yeah. I mean, I think it's a really difficult thing to put a single figure on because by its very nature, you know, the legal market and criminality generally doesn't want to be measured because it doesn't want to be identified. So, you know, having that exact figure of how much money is going through or, you know, what the exact channelization rate is, is maybe not impossible. think certainly at the moment, it would be near impossible to give that single figure.
The approach that we're increasingly taking is to try and kind of layer different data, different evidence to try and give you a really rich picture. So there are different ways of trying to measure the scale. You that'd be looking at web traffic, looking at the type of, you know, the amount of money that's flowing, the number of sites, things like that. But I think to get a really good picture of the illegal market and to understand where you need to fight it, you also need to understand kind of the consumer end of this. You know, what actually either
Ted (03:40.311)
Mm-hmm.
Tim Miller (04:03.447)
motivates consumers to choose to go to the back market? What are the routes where they may accidentally stumble upon it? What's either drawing them to the illegal market or driving them to the illegal market? And you need to have all of those pieces in place to get a really comprehensive picture. So I do think anyone who either relies on one set of data or says they have an exact number for the illegal market is wrong on that. think, you know, given the state of our knowledge and
saying not just here but across the world you can't have that exact picture and nor would you want to rely upon any one single bit of data because it you we're dealing with some really complex criminal networks behind this and as a result you need to have that kind of complexity of data and evidence to help you really understand that.
Charlie Horner (04:53.412)
Sure, yeah, it's it's certainly complicated. Ted, I'll bring you in here. 'cause on on the news desk we get quite a few of these sort of reports with with estimates of how big the black market is in the UK and around the world. How how much weight do you put behind some of the figures that you see and how difficult do you think it is to to sort of weigh up the size of the illegal market?
Ted (05:13.997)
I'm very much on Tim's camp on this. And I don't think that the focus should be on measuring it. I think it should be much more understanding it and understanding its patterns and what it's leading to. And I want to kind of flip this back to Tim and say, look, are we still kind of this very kind of opaque stage of what is illicit gambling, but also where is kind of criminal networks are spreading and what are the kind of online enablers
this activity.
Tim Miller (05:46.245)
Yeah, I mean, I think our understanding and awareness of the legal market is certainly quite high. So actually locating many of these sites is not a particularly difficult challenge for us and other regulators. You can find them. That's not the issue. The issue is one being able to take them down, especially when they're based in other jurisdictions and particularly in jurisdictions where actually there is no kind of law enforcement corporation. You if you if you've got a
Ted (05:58.2)
Mm-hmm.
Tim Miller (06:14.065)
a criminal network based in Russia, our ability to drag them into the magistrates courts in Birmingham is going to be almost zero. But we do have kind of good understanding of where they are and how they operate as well. I think then having that clear understanding is what are the routes that people are using to find the illegal market, to get to the illegal market. As you say, Ted, what are the enablers for that?
I think is really important because yes, taking enforcement action is a really key part of your response and we're continuing to ramp that up. But actually, to an extent, enforcement action is a little bit whack-a-mole. know, every site that we close down, there will be others that spring up. So what you want to be able to do is take an approach that makes it harder, first of for these sites to target British consumers, particularly vulnerable British consumers.
and to make it harder for consumers to get to those sites. And that does mean not just focusing on the illegal sites themselves, but focusing on the tech platforms, social media companies, advertisers, actually those in the license industry that perhaps have also got one foot in the illegal market camp as well. So, you know, there's no one response that you can take to this. think, you you sometimes hear people say, well, you know, the simple answer is that.
the government commission should do this or government should do that or industry should do this. You probably need to do all of those things. There is no one kind of silver bullet here. The key, I think the key focus over the next couple of years needs to be making sure that all of those players that want to fight this criminality are doing so in a joined up way that we're kind of working together, not tripping over each other and collaborating as much as we can.
Charlie Horner (08:02.53)
Mm. Yeah, you you mentioned domain blocking there as a big part of this fight against illegal sites, but I as you as you say, it can feel like a whack-a-mole scenario. so what I guess first of all, how difficult is it to sort of be acting in that sort of reactive way and how can you be more proactive in that? Is it is it does it come down to that sort of collaboration that that we're talking about here?
Tim Miller (08:25.425)
Yeah, so I mean, things like domain blocking are absolutely important and we're really pleased that in the next couple of months, we will get the powers to be able to get court orders to close down domains at the ISP level. I think that is an important additional tool that we'll have, but don't be under any illusion that that's going to be the kind of the single fix for the risks that exist here. As you say, know, other sites will crop up. There can be a bit of a whack-a-mole situation, but...
Nevertheless, when you identify these sites, you do need a way to be able to take them down. So it's an important addition. But as you say, Charlie, think, you know, collaboration is that key thing. You know, think developments like the government's task force, is, you know, chaired by the gambling minister, are an important example of that. You know, it's place where you can bring together all of these different voices to not just kind of share ideas and approaches,
but actually to be holding each other to account as well. know, absolutely as a regulator, we should rightly be held to account for taking seriously, you know, our duty to deliver the licensing objective of keeping crime out of gambling. But at the same time, you know, we will be holding to account alongside kind of government and others, you know, tech companies, social media, payment processes, you know, others in industry to make sure that we're all playing our part.
If you think of other areas where you are dealing with organized crime, overseas gangs, drug trafficking, human trafficking, terrorism, things like that, you would not be relying solely upon a relatively small regulator in the Midlands in England to do all of it. We've got a really key role here, but we've got to be working alongside a whole range of other partners, both domestically and internationally.
Charlie Horner (10:17.804)
Sure, yeah, and big tech does play a big part in this. I know, Ted, that's something that you wanted to to to raise here. Did you want to jump in on on the big tech angle?
Ted (10:24.074)
Yeah, I mean, Tim, I'm sure you've been, you know, it's been raised time and time again and it's been raised, you know, we were at the, Bentley and gaming council and they talked about that accountability of the big tech platforms, Metas, your Googles, your X's.
where do they come into play? And also how do you kind of form a binding kind of cooperation or umbrella between all parties, bit tech, media, the licenses and the regulator.
Tim Miller (10:57.925)
Yeah, so I think the big tech companies, particularly the social media platforms and the kind of the search engines have such an essential role to play here. And actually, they don't play their role significantly. And frankly, they're not at the moment. It massively undermines the efforts that the rest of us are putting in place. you you think of the value that something like Gamstop has brought to this market, you know, arguably one of the
best multi-operator self-exclusion schemes in the world. Huge number of consumers benefiting from it. And the fact that people like Meta and others are simply unwilling to take the action that's needed to stop, not on GamStop ads appearing on their sites, drives the coach and horses through elements of that protection. So it's not just about, we need them to make progress. We need them to stop undermining the progress that we're already making. And
I'm increasingly frustrated and at times angry by the lack of action that they're taking. we've seen this with government announcements this week that clearly there's a range of stakeholders that do not have confidence that the social media platforms are willing to take the action they should be taking to protect consumers in a whole range of areas. And it's right that all of us hold their feet to the fire on that. I particularly
kind of echo the comments that BGC and Grunew in particular has made this week about that kind of call to action for those tech companies. It's so important they take it seriously and they are not. I find it almost like incredible that you read in the news all of these kind of tech billionaires competing to be the first one to put a man on Mars. They think they can deliver that, yet they seem to claim that they are incapable of stopping non-Gamstop ads appearing on their platforms.
I mean, that's just nonsensical.
Charlie Horner (12:53.634)
Yeah, I I can I can really sense your passion a and and anger on this one, Tim. Do do you think it's do you think it's a case of they just don't particularly care or don't understand or don't want to put put resources and time into into this? What what do you th what do you think's causing this?
Tim Miller (13:11.025)
So there are practical and technological challenges. I absolutely accept that. I'm sure there's not a single button that can be pressed that solves that overnight. So I accept it. It's something that needs them to work with us, government and others to get it right. But everything that I have seen, particularly over the last couple of years, is they only act when they're really pushed. So yes, 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 kind of routes to the legal market appearing in the first place. Now, you know, they will say about how difficult it is, they say, accept there are some challenges, but I simply refuse to believe that companies with all of the technological expertise, the resources they've got, as I say,
I don't simply say it to be tongue in cheek, some of these companies are generally seeking to put people on Mars, but are claiming that it's too difficult to stop these ads appearing. I just don't believe it. And they need to be held to account for that. And I think if they refuse to take action or they're unwilling to take action, then there has to be consequences for that. As a gambling regulator, there's a limit to what we can do to impose a consequence. I think, let's be honest about it.
even if we felt there was a strong enough evidence base for us to prosecute someone like Metta under the gambling act. Well, if we did that, probably the additional 26 million pounds that the government gave us would be gone within a fortnight because of the inequality of arms. We've got this just a reality. But actually, if governments around the world can kind of get together and then take action against them to address the harms that they're facilitating, then that's the way that you've got to respond to it.
Charlie Horner (15:04.228)
Sure. And we'll we'll come to the twenty six million pound after the break. But just before we do go to that break, Tim, y you you mentioned and we're obviously talking here a lot about social media and and big tech and and the adverts, but I guess there's there's also an element of where you s the sponsorship of influencers and things like that on social media. and we you know, that's becoming more prevalent in the last twelve months or so. How concerned are you by that trend where we're seeing
you know, individual influences and maybe we don't want to talk about individuals, but that there is that trend. A are you concerned by that and how do you begin to to tackle that as a as a means of advertisement?
Tim Miller (15:43.663)
Yeah, absolutely. I think it's an area that you are seeing grow. And I think the particular challenges with it is, and it actually does come back to these social media platforms again, that actually it's really easy now for individuals to advertise, to create content really quickly, upload it almost instantaneously. you compare that to the hoops that license operators have got to go through to get an advert on TV, let's say.
You know, there are checks and balances that, okay, not always 100 % foolproof, but generally prevent non-compliant adverts from being broadcast. In the online space, particularly on social media, there is none of that. You you or I could probably create an ad. I mean, we could do it now if we wanted to and have it uploaded before we finish recording this. So where is the point that you can build those checks and balances in? So I think that's the first challenge with influencer.
marketing. The other is that frankly a lot of these influencers either don't have people around them advising them or don't have people advising them that really understand the one the risks that exist here and the legal requirements you know your average kind of social media influencer isn't going to know the ins and outs of the gambling act. don't necessarily blame them for that in itself but actually if you are going to be advertising to people particularly people who might be vulnerable
then it is important that you do understand what the rules are and that the platforms that you're using ensure that those rules are being applied. that combination of the ease of getting that marketing up and the lack of knowledge around what compliant marketing is does create an additional risk here.
Charlie Horner (17:30.488)
Yeah, it certainly does. It's it's a trend that we're seeing more often and and hopefully we can sort of get to the bottom of that. But Ted, Tim, let's take a a very short break and we'll come back and we'll continue our chat.
Break
Charlie Horner (18:43.672)
Welcome back to iGaming Daily. W today we're joined by the Gambling Commission's Executive Director, Tim Miller. Tim, let's cast our minds back now to the the announcement of the budget last November. the industry will will remember that for perhaps the the tax hikes that w that were included. But one one part of of the budget was particularly interesting was that an additional twenty six million pound w w was committed to combating
illegal gambling through the the illegal gambling task force. Wha one thing that's sort of been a question of hours in the month since was what what those funds are are going towards and what the what the remit of the illegal gambling task force is going to be. did could you could you divulge some of the details on that please?
Tim Miller (19:34.77)
Yeah, so I mean, I'll need to keep it fairly high level because for the main reason, we don't want to disclose too much to the criminals themselves exactly what we're doing. I I don't know how many listeners you have in Moscow, but if there any out there, I'm not telling you how we're doing this. But at a high level, the sort of areas that we're going to focus spending on first is around people. And actually, we've already started that. We had a kind of whole load of new folks joining our legal markets team just in the last 10 days.
Ted (19:48.144)
You
Tim Miller (20:04.079)
And what that will allow us to do is to kind of ramp up some of our enforcement action, our disruption actions. So we'll be able to issue more cease and desist. We'll be able to kind of disrupt more websites. So having those those bums on seats is a really important part of it. It also means that we're able to bring in kind of new skills as well. You know, as a public body,
we are competing against people for those sort of skills that have got a lot more money than we have. So, know, a of additional funding will help us bring in some of skills that we need. So people's the first kind of part of that. The second part then, I think, is around kind of technology. And we have got, you know, we deploy a lot of technology in this space already. I mean,
It's almost frustrating that you can't talk about the detail because some of it is just cool. Well, our illegal markets team to, you know, blow your mind some of the techniques that they they use. But the technology is improving all the time. So I think the opportunity for us to be able to invest in other technologies that will help us identify, detect, kind of remove these illegal sites will be another important part of the investment that we've got there.
So think those will be the two main areas of our focus. Then the third bit, which probably isn't as resource intensive in terms of money, but still takes time and effort, will be around continuing to strengthen those relationships with our regulatory law enforcement and other partners, both here in the UK and internationally. There is a...
growing kind of momentum behind kind of collaboration between regulators and governments around the world. you know, just a week before last, I was in Sofia in Bulgaria with over 100 gambling regulators from across Europe. And one of our main areas of focus was how we can work more closely together on tackling the illegal market. We also chair a committee at the International Association of Gambling Regulators, which brings gambling regulators from across all continents of the globe.
Tim Miller (22:19.857)
to focus on the legal market as well. And obviously putting some resource into that sort of collaboration is going to be really important. So those are the broad areas that we're focusing on without divulging too much of the specifics.
Charlie Horner (22:34.168)
Sha sure, yeah, you don't want to play play your hands to the the very people you're trying to to catch. But Ted, it's something that we've covered a lot on on both the the show and on Desk B C News. Is there anything that you'd like to come in and and ask as as a bit of a follow up there?
Ted (22:49.459)
Okay, yeah sure, so, you know, we are...
dealing with an evolving risk here. And also, one of the particularities here is that how is your interpretation of the current law, and as someone who's worked in policy enforcement and policy direction, how is that impeding the tackling of the black market? And especially in relation to AML, the fact that these guys might be using crypto, where...
our kind of regulatory framework hasn't catched up yet. How kind of deficient is that towards tackling an active threat?
Tim Miller (23:30.326)
I'm not sure I necessarily agree that the regulatory framework acts as an impediment here. mean, actually, the framework we've got was put in place in the 2005 Gambling Act. And despite calls from lots of people, campaigners, academics and others for a new gambling act, I think it's generally stood the test of time. It's empowered us sufficiently that we can respond reasonably well.
to changing threats. you know, I think the whole definition of what's gambling and what's not generally is pretty sound in the UK. Yes, you've got some things that nibble around the edges a bit, but we don't have any of the sort of challenges, for example, that you see in the United States as to whether prediction markets are gambling or not. You know, it's pretty black and white here. So I'm not sure the framework presents a massive challenge.
Ted (24:07.475)
Yeah.
Ted (24:17.799)
Mm-hmm.
Tim Miller (24:24.177)
I think there were certainly some gaps in our powers and the new powers that we'll be getting in a couple of months time will be an important addition to that. I think the sort of challenges we do face are around that inequality of arms between us and others that are fighting the illegal market and the resources that some of those in the legal market have. It will inevitably mean that for us as a gambling regulator by ourselves, we're not going to be able to deploy
technology as widely as some of the criminals that we're up against, which is why you do need this joined up approach. If we can combine our powers and resources with those of law enforcement, of other regulators, of government, then that does give you, I think, a much greater chance of addressing many of these risks.
Ted (25:13.514)
Aren't you impeded by these kind of legislative holes at the moment? For example, the UK's uptake on kind of crypto and actually defining kind of settled regulation in there. Isn't that kind of a block?
Tim Miller (25:28.271)
I think, mean, crypto is a good example of where I think there can be space for some innovation in the licensed market that may well play a role in stopping some people drifting to the legal market. Clearly, there are a range of different people that want to use crypto, kind of people younger than me, kind of crypto natives. It's a normal part of their consumer experience.
So we are working with our industry forum with others to look at what is the route that we can take to open up the opportunities for licensed operators to make more use of crypto. I mean, there's no ban on it at the moment, but I think it would be challenging at the moment for an operator to show that they could accept crypto and still be compliant. Now, certainly the work that other regulators are doing, most notably the Financial Conduct Authority, I think will help us.
You know, now that the FCA have set out their pathway for some form of regulation over elements of crypto, I think that will make life easier. Certainly, we didn't want to be kind of the first ones in the UK as a regulator to jump into the crypto space. We certainly do want to get ahead of the financial regulator. But I don't think those I mean, those barriers are not particularly hardwired into the legislative system. It's just about all the different parts of the regulatory system.
of making the changes they need to open that up. But certainly I can see in the not too distant future opportunities for licensed operators here to be able to make use of crypto as a method of consumer deposits. And that will, I think, undoubtedly play a part in addressing the legal market. Our research shows that crypto is the second most
associated search term with people going to the illegal market. It won't cut the illegal market by half or anything like that, but all of these things together will make a difference.
Charlie Horner (27:29.038)
Yeah, that's that leads me nicely on to on to the next question really, because we're talking about those those push factors of why do why do consumers go to the the black market in in the in the first place. And I think a lot of licensed operators would say that the the strongest defence against the black market is is having a a a competitive and regulated sector. but perhaps some of those are are unhappy with the sort of transitionary period that we're we're in in the UK right now.
How how do you balance like having strong consumer protections, which of course are needed, with not pushing players towards the black market? You know, we're starting to see some of the mitigation measures that some operators are putting in. how how do you how do you see that balance?
Tim Miller (28:12.785)
Yeah, so I would agree that having a vibrant, competitive, but well-regulated market domestically is a really important part of beating the legal market. I mean, if you look at some of the jurisdictions that have much worse channelization rates than we do, they are often markets that are not as competitive. They might still be a monopoly position. And I think providing consumers with choice is a really important part.
Now, for all of the kind regulatory reform that's happened over the last few years in Britain, we still have one of the most diverse markets in the world and we are still one of the largest regulated markets in the world. So there are very few types of gambling products that a domestic consumer couldn't find within the licensed market. So I still think we are in a very competitive place and in a position to continue to be a really
competitive market. But we also recognize that regulatory kind of changes can come with unforeseen consequences and can can sometimes have outcomes that you didn't intend. So as part of the evaluation that we're doing alongside government of the white paper measures, understanding the impact it might be having on pushing people to the legal market or not is a really key part of that. Now, so far,
based upon the research we've done, we have not seen large numbers of consumers being pushed to the illegal market because of regulatory requirements. There are undoubtedly people out there that have been, but generally that is not currently one of the biggest factors. But that doesn't mean that we shouldn't always keep that under review. So certainly ensuring that kind of regulatory approaches deliver consumer benefits whilst minimizing the risk of pushing people to black markets is important.
I think there are things that actually the licensed market themselves can do. We do know from the research that some people go to the black market are because they faced restrictions from operators because they've been successful. think it is important that we recognize that that plays a part. We know that curiosity drives some consumers to the legal market. I one of the downsides of all the conversations we're having about the illegal market, which are important conversations to have, is it also increases the visibility
Tim Miller (30:39.665)
of the fact that there is an illegal market and probably makes people curious. kind of perversely might actually encourage some people to look at that. You then got people that are being directly targeted, particularly the most vulnerable consumers, know, those that are self excluded. And then you've got people that perhaps kind of stumble there by by accident as well. So it's a really complex range of reasons why consumers end up in the black market. But we have to deal with all of them. And I don't think any one is any more or less important than
than others, you've got to look at all of those together.
Charlie Horner (31:10.338)
Yeah, absolutely. we we're coming towards the end of our time here, but but Ted, I I think this is one of the biggest questions that we we have throughout this year really is how operators sort of react and and and develop and evolve to this transitionary period that we're in at the moment in the UK. do do you have any anything that you'd like to add on to what Tim said, or perhaps would you like to ask a follow up here?
sorry, your muted Ted.
Ted (31:38.731)
Sorry, just one final question to Tim. And this is on the outlook of the UKGC as a regulator and one that's going through a transition in leadership. How would you advise the new chairman and the new CEO coming in into the regulator to tackle an issue as complex and as broad as this and to do it effectively?
Tim Miller (32:06.309)
Yeah, I think there's two main kind of bits of advice I would give. One is make sure that we're robustly evidence based. You know, I'm involved with lots of conversations about how you address the legal market. And I think a lot of people kind of go with their gut and think, well, this is the way you solve it. And actually, the evidence might suggest otherwise. So think, with everything we do, being robustly driven by the evidence is really important.
And then the second is making sure that we are as strongly connected to anybody that can work positively with us. As a regulator, it's absolutely right that we're independent, but sometimes people take that to mean that you should never be in a room with the industry or you should never be in the room with campaigners. So my view is be in the room with anybody that is going to help you be more successful, that shares your commitment to addressing this risk, is willing to play a
kind of collaborative and cooperative part. So don't cut yourself off from any of those audiences. Be prepared to work with anybody that can help us deliver those outcomes. And I think the combination of that kind of collaborative approach and that evidence-driven approach, I think is the way that you have the greatest success.
Charlie Horner (33:23.066)
Brilliant. Well, Tim, thanks ever so much for for being so candid and and sharing your expertise and and experience with us today on the show. We really do appreciate your time. Ted, thanks again for joining me as always. It's always great to have you with us. Thanks to Optimove for supporting the show as always, and to our audience, thanks for tuning in to today's episode of iGaming Daily, and come back tomorrow to keep up to date with all the latest global gambling news.