Consultant: More research into black market motivations needed instead of “misplaced critique”

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Consultant: More research into black market motivations needed instead of “misplaced critique”

More research into what motivates customers to use the black market would help the gambling industry rather than “misplaced” criticism, according to an industry consultant.

There has been much discussion about the potential threat the unregulated black market possesses in the UK, after a PwC report carried out by the Betting and Gaming Council (BGC) showed the amount of money staked with such operators doubled to £2.8bn ($3.9bn) in 2020 compared to 2019.

While BGC CEO Michael Dugher said the report demonstrates “how the unsafe, unregulated black market is a growing threat” to players, Gambling Commission CEO Neil McArthur, dismissed the report as being “not consistent with the intelligence picture.”

And yesterday we reported that co-founder of charity Gambling with Lives Charles Ritchie, told Gambling Insider that such black market threats are “scaremongering” and instead the UK industry should “act more responsibly.”

In response, industry veteran and CEO of independent gaming consultancy firm Gaming Economics Lee Richardson, told Gambling Insider that time would be better spent looking into what drives players to the black market, rather than debate its threat, or lack of.

Speaking to Gambling Insider, Richardson said: “Of course, the biggest single challenge in making any real impact assessment of any black market is that no-one knows the real scale or scope of such a market, by definition. It isn’t measured, not is it easily measurable. One has to rely on estimates, guesstimates and anecdote, so it’s not the greatest basis for informed comment.

“I’ve read some of the commentary, and criticism, concerning the PwC Report into this topic and I think some of it is misplaced, frankly.

“Rather than simply critique the content or conclusions, I would argue that more, not less, research into the current motivations of consumers who use the black market would help both the regulator, and the industry, in formulating sustainable changes to the regulated sector.

“Helping consumers to have fewer reasons to consider leaving the regulated sector should be the guiding principle here, nothing less.

“For long term sustainability, we need better, deeper and evidence-based understanding of what truly, and unequivocally, constitutes ‘problem gambling’. The current reform of the 2005 Gambling Act must deal with this critical weakness.”

The debate comes at a time when Government body Digital, Culture, Media and Sports Committee (DCMS) is leading a review into the 2005 Gambling Act, to assess current UK regulation and decide if reform is needed. You can read more in our in-depth black market feature in the upcoming March/April edition of Gambling Insider.