Report: Japanese Gamblers Risked $45 Billion on Illegal Online Casino Sites in 2024
Report: Japanese Gamblers Risked $45 Billion on Illegal Online Casino Sites in 2024
- Officials in Japan say illegal online gambling continues to mount
- Illegal online sports betting on soccer is of utmost concern
- Japan will welcome its first land-based casino in the coming years
Gambling in Japan remains limited to the state-run lottery, the sports lottery, and parimutuel wagering on horse racing and motorsports. That will change in the coming years when MGM Resorts opens MGM Osaka, Japan’s first regulated brick-and-mortar casino.
Japan’s limited gambling market hasn’t prevented millions of Japanese people from gambling unlawfully. A new report from Japan’s Council of Sports Ecosystem Promotion suggests that people in Japan bet 6.45 trillion yen (US$45 billion) on illegal, unregulated gambling websites in 2024.
Unlike in most legal sports betting markets where private operators run the industry, Japan’s national government possesses a monopoly on sports gambling through its sports lottery. The Sports Promotion Lottery, or “toto,” raises money for the Sports Promotion Fund. The government-run sports lottery, however, limits how much a bettor can risk and therefore win/lose.
That’s caused many millions of Japanese to take their action to offshore sportsbook platforms and apps where better odds, larger bets, and more promotions are offered.
Mounting Problem
Japan’s National Police Agency assisted in the illegal online gambling survey for the Sports Ecosystem Promotion Council. Using data regarding the number of individuals who faced illegal online gambling charges, along with insights from overseas iGaming and sportsbook operators that are regulated in foreign countries and, therefore, make some of their data public, the Council concluded that illegal online sports betting is thriving in the Land of the Rising Sun.
While the report estimated that around 3.37 million people in Japan utilized illegal offshore online casinos in 2024 and wagered roughly 1.2 trillion yen, the illegal online sports gambling market is considerably larger.
Dubbed the “Freeride Market,” the report concluded that the Japanese made at least 4.9 trillion yen in unlawful sports bets over the internet last year. More than half of the illegal bets — 2.9 trillion yen — were gambled on soccer.
The investigation revealed that some overseas sports betting websites accessible from Japan provide services in a manner that may infringe upon copyrights, likeness rights, publicity rights, and other rights,” the Council reported. “The overseas sports betting operators providing services in the manner described above are providing illegal services to residents of Japan.”
The Council said many online casino and sports bettors claim to be unaware that their participation was illegal upon apprehension or investigation.
Major offshore gaming hubs include the Philippines, Malta, Curacao, the Isle of Man, Anjouan, and Ukraine. Those jurisdictions allow the iGaming and online sportsbook firms to gain licensure to target gamblers in foreign nations in exchange for a tax share. Critics say such businesses come with few consumer safeguards, such as fair play or assurances that their winnings and withdrawals will be executed.
Pachinko Not Considered Gambling
Along with lottery, parimutuel wagering, and its forthcoming Osaka casino, Japan is home to thousands of pachinko parlors.
Japan doesn’t consider the slot-like amusement games as a form of gambling, as players are only to win prizes similar to how an arcade works. However, it has long been common for pachinko cash redemption facilities to be located adjacent to pachinko parlors.
The transaction centers are commonly operated by the same owner as the pachinko business. The redemption facilities allow players to exchange their coupons and tickets for cash.
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