Seventy-five percent of the turnover in Europe’s online casinos is generated by problem gamblers, according to the Swedish health authority. It’s a booming business that three freelance journalists wanted to dig deep into. To do so, they had to use an unusual method.
Gambling companies were reluctant to give insights and interviews. At the same time, it proved difficult to establish credible sources from within the industry. So the team had to go undercover. Amongst other things, they visited gambling conferences by pretending to want to start illegal online casinos.
Their investigation reveals that many of the gambling industry’s claims to act responsibly toward individuals with worrying gambling habits amount to empty promises. Meanwhile, illegal practices are widespread, with many companies happy to help circumvent national laws intended to protect vulnerable Europeans from gambling addiction.
Gambling has been classified as a public health threat since players’ addiction can lead to anxiety, depression, and, in some cases, suicide. As more and more people gamble online with smartphones, the casino is always with them in their pockets.
In EU countries like Sweden, Austria and Germany, online casinos must be licensed – and they are required to ban users suspected of having a gambling problem. Users themselves can ask to be blocked from using the sites.
However, many online casinos skirt duty-of-care laws by registering in Malta and offering their services across the EU in local languages, the investigation found.
The journalists show that Malta’s economy profits from European gambling addicts by offering lax regulations for the gambling industry. Many online casinos operating illegally refuse to reimburse gambling losses, and Maltese law shields these operators through legislation allowing Maltese courts to disregard valid supreme court judgements from other EU member states.
Despite acting unlawfully in neighbouring countries, the same companies continue to receive licensing and approval from gambling authorities, leaving at-risk players without adequate protection.
Regulatory bodies across Europe lack effective tools to combat these illegal actors. In Austria, for example, a subsidiary of the partly state-owned gambling monopolist was found to be doing business with companies that also operated illegal online casinos in the country.