The UK government has raised the money laundering risk rating for the casino sector from low to medium. Officials justified this measure by drawing attention to the increased complexity and volume of financial activity in remote gambling platforms as evolving criminal tactics seek to circumvent current safeguards. Black market operators remain another pressing concern despite ongoing attempts to curb their influence.
The Report Identified Several Potential Vulnerabilities
According to the 2025 National Risk Assessment (NRA), published by HM Treasury, remote casinos are among the most vulnerable in the broader gambling ecosystem. Increased customer anonymity, cross-border fund movements, and new technologies all represent rising compliance challenges. Authorities pointed to a stark increase in suspicious activity reports (SARs) from the sector, a 26% year-on-year leap, and an influx of illegal online gambling sites targeting UK citizens.
The Treasury’s analysis identifies several emerging threats, such as the use of virtual private networks (VPNs), prepaid cards, third-party transactions, and the abuse of white-label arrangements, where oversight has historically been lacking. Peer-to-peer poker and crash games, especially those within crypto casinos, have also emerged as possible channels for criminal activity and money laundering.
The most common occurrences of ML through licensed casinos are in the form of recreational spending of criminal property. However, there are also instances of attempts by criminals to ‘clean’ funds through casinos.
HM Treasury report
Casinos providing money service business (MSB) services, including foreign currency exchange and third-party cheque cashing, remain another potential point of vulnerability. Although fewer operators offer MSB services compared to 2020, the remaining businesses reportedly draw higher-risk customers and feature complex transaction chains, often linked to high-risk jurisdictions.
Compliance Among Casinos Remains Insufficient
The HM Treasury report also highlights ongoing vulnerabilities in customer due diligence (CDD), particularly in non-remote casinos where transaction thresholds may not trigger additional scrutiny. Concerningly, compliance with enhanced due diligence (EDD) among operators has declined, with 41% of casinos inspected in 2024 found not to be applying EDD correctly.
As with other sectors, casinos are experiencing increasingly sophisticated attempts to bypass CDD checks using false documentation, which in some cases have been generated using Artificial Intelligence (AI).
HM Treasury report
While the risk of terror financing for the sector remains low, the Treasury underscored the need for full compliance with mitigation requirements. Such measures are necessary due to the industry’s mix of local and foreign customers, including politically exposed persons (PEPs) from jurisdictions of greater risk.
Meanwhile, the UK Gambling Commission continues to confront illegal casinos via thorough enforcement actions and digital takedowns. Between April 2024 and March 2025, the regulator issued over 1,100 cease-and-desist notices and removed 81,000 web links to illegal casino activity. However, the surge in online gambling and the introduction of cryptoassets and AI-generated identities mean vigilance and regulatory flexibility remain essential.