A recent report by the All India Gaming Federation has highlighted the significant extent to which Indian players are engaging with the black market for gambling.
Surge in Traffic to Unlicensed Betting Platforms
The report revealed that unlicensed betting sites attracted a staggering 1.6 billion visits over a three-month period. This high volume of traffic underscores the ineffectiveness of existing measures designed to curb black-market gambling. Specifically, website-blocking initiatives have failed to produce the intended results.
Evasion Tactics and Regulatory Challenges
A major reason for the persistence of illegal betting platforms is their ability to bypass regulatory barriers. Many operators exploit mirroring websites, which allow users to circumvent takedown orders and blocking protocols. Additionally, new Unified Payments Interface (UPI) accounts are being used to facilitate transactions while avoiding detection by authorities.
Citing Reserve Bank of India (RBI) data from July 2024, the report disclosed that mule accounts process an estimated $300 million in illicit funds each month. The illegal gambling market is one of the largest beneficiaries of these transactions, relying on such financial loopholes to remain operational.
Ineffectiveness of Website Blocking Measures
The report strongly argues that blocking websites alone is an inadequate strategy for tackling the black market. Drawing comparisons to international markets, it cited Norway, the UK, Denmark, Belgium, and the United States as examples where such measures have proven ineffective in fully dismantling illicit gambling networks.
A Sophisticated Network of Payments and Marketing
Illegal gambling operators employ an advanced and diversified financial network. Their payment infrastructure includes UPI transactions through mule accounts, cryptocurrency payments, and international e-wallets, making enforcement and tracking more complex.
The report also pointed to the crucial role of social media and influencer marketing in driving traffic to illicit sites. Over a three-month period, social media alone accounted for 42.8 million visits to just four illegal gambling websites. Additionally, referral traffic generated 247.5 million visits, primarily originating from adult websites, gambling affiliates, and promotions on sports and video streaming platforms.
Facebook’s advertising policies were specifically criticized for contributing to the rise in exposure to illegal gambling services. The report emphasized the urgent need for stricter advertising regulations across digital platforms.
Recommendations for Stronger Enforcement
To effectively counter illegal gambling operations, the report urged government authorities and regulatory bodies to implement a series of proactive measures:
- Collaboration with Digital Advertising Intermediaries: Establish formal agreements with social media platforms, search engines, and ad networks to monitor, flag, and remove illegal gambling-related advertisements.
- Stricter Advertising Regulations: Enforce tighter policies on paid promotions to prevent direct advertising of illegal betting services.
- Crackdown on Influencers: Impose immediate bans on influencers found promoting illicit gambling platforms.
- Updated Lists of Gambling Operators: Maintain and publish regularly updated blacklists and whitelists of gambling operators, allowing players to distinguish between legitimate and illegal services.
The report stated: “These lists should be continuously revised and, where possible, made publicly accessible in a user-friendly format, enabling consumers to easily distinguish between legitimate and illicit operators.
“For maximum impact, these enforcement efforts should be aligned with broader regulatory strategies, including the regulation of online gaming. By providing a clear legal framework, the government can offer consumers better guidance, enhance consumer protection, and promote responsible gaming practices, clearly differentiating legitimate platforms from illegal platforms.”
With the increasing sophistication of the black market, the report emphasized that a multi-faceted approach—combining enforcement, financial oversight, and regulatory reform—is essential to effectively combat illegal gambling activities in India.
