The UK government has raised the money laundering (ML) risk rating for the casino sector from low to medium, with remote gambling operations flagged as a central area of concern
The UK government has raised the money laundering (ML) risk rating for the casino sector from low to medium, with remote gambling operations flagged as a central area of concern, according to the Treasury’s 2025 National Risk Assessment (NRA).
The report highlights how a post-pandemic shift toward online gambling, coupled with technological loopholes and weak oversight in white-label partnerships, has created fertile ground for criminals to exploit both licensed and unlicensed remote casinos.
Online growth
The surge in funds flowing through online casinos is a key driver of the upgraded risk status.
The Treasury links this rise to long-term behavioural changes following the Covid-19 lockdown, which pushed more players toward digital platforms — and along with them, new money laundering typologies.
While many instances involve criminals simply spending illicit proceeds recreationally, the report also points to deliberate laundering schemes, where actors gamble to disguise the origin of funds, later withdrawing money through legitimate payment methods.
Crash games on the radar
Amongst other threats, the UK Treasury has identified crash games as an emerging money laundering risk, warning that the fast-paced format may help criminals disguise illicit transactions.
Because quick cash-outs are a normal feature, the Treasury says criminals can mimic legitimate play while moving illegal funds.
The report highlights that crash games are especially popular in crypto casinos — which are illegal if accessible from the UK — but are also now being offered by some licensed operators.
“The increased interest from the regulated casino market in crash games may pose an opportunity to launder criminal funds through GB-regulated operators.
“As there is an incentive for legitimate customers to use these games in a similar way as may be useful to criminals, criminals could conceal the high risk behaviour of cashing out quickly with limited gameplay within the context of the crash game (where these behaviours are inherently more common).”
White-label partnerships
One of the report’s most prominent concerns involves the use of white-label partnerships in the online gambling sector.
“Historically, some white-label arrangements included gambling operators relying on unlicensed third parties for elements of their compliance approach.
“In these cases, the licensee would remain responsible for compliance, although they did not always have sufficient oversight.
“These arrangements are now less common, but risks remain where white-label providers offer large numbers of websites, as failure by a single remote casino to control the ML risks relating to their white-label partnerships can impact a significant number of websites,” the report states.
Criminals from abroad
Online platforms, the report states, are also vulnerable to geographical abuse, with criminals using Virtual Private Networks (VPNs) to disguise their physical location and appear as if they are operating within the UK.
This tactic enables users from high-risk jurisdictions to bypass local restrictions and access UK-licensed platforms.
Although many operators have geo-blocking controls and VPN detection tools in place, the Treasury notes that criminals are likely to target platforms with weaker systems, particularly those with white-label arrangements or limited internal AML capacity.
The Treasury flags a troubling rise in the use of false identities and AI-generated documents to bypass onboarding checks on online platforms.
Weak CDD compliance
Since 2020, income from remote slot games has increased by 52%, reaching £3.6bn, with users gambling for longer periods.
The scale and speed of this growth, combined with gaps in customer due diligence (CDD) compliance, significantly increase the potential for abuse, the report found.
Recent inspections revealed that 12.5% of remote casinos failed to meet CDD requirements in 2024, up from 7% in 2023.
Additionally, 41% did not apply enhanced due diligence (EDD) on a risk-sensitive basis, compared to just 11% the previous year.
The report also references the government’s new slot stake limits — £2 for players aged 18–24 and £5 for others — which came into effect earlier this year.
However, it concludes there is not yet sufficient data to evaluate their impact on reducing ML risks.
The black market
Beyond licensed operators, the Treasury said illegal remote casinos continue to target UK consumers, particularly through online marketing and crypto-based platforms.
In 2024/25, the Gambling Commission issued 1,158 cease and desist notices and referred over 118,000 URLs for removal from search engines.
Despite this effort, the Treasury admits that illegal online casinos remain a growing threat, both as vehicles for laundering criminal proceeds and as part of wider illicit networks.
On a more positive note, the overall risk of terrorist financing in the sector remains low, according to the Treasury.
https://next.io/news/regulation/uk-treasury-crash-games-heightened-ml-risk/