Key Moments:
- Michel Groothuizen, chair of the Kansspelautoriteit (KSA), has emphasized that combating illegal gambling requires greater international collaboration
- The Financial Action Task Force (FATF) has recently identified illegal gambling as a major financial crime risk in its September 9 communication
- KSA estimates that the Netherlands loses more than €500 million ($587 million) in tax revenue each year due to offshore gambling operations
Regulatory Leadership Pushes for Cross-Border Coordination
The chair of the Kansspelautoriteit (KSA), Michel Groothuizen, has stressed that the Netherlands cannot tackle illegal offshore gambling networks in isolation. He has called for a broader European initiative to disrupt the financial, advertising, and technology systems supporting these operators.
Groothuizen’s appeal came after the Financial Action Task Force (FATF) identified illegal gambling as a significant risk to the financial sector, highlighting that, in several jurisdictions, the illegal gambling market now surpasses the size of the legal market. The KSA estimates that the Netherlands misses out on more than €500 million ($587 million) in annual tax revenue due to these activities.
Emphasis on the Limits of National Approaches
In a blog post released on September 11, Groothuizen underscored the additional risks posed by illicit operators, including the targeting of self-excluded individuals. He maintained that national enforcement agencies are limited in their reach when it comes to these overseas entities.
During a recent parliamentary debate, some Dutch lawmakers called for new enforcement mechanisms, including the ability to block illegal websites. Groothuizen, while welcoming these initiatives, pointed out that international enforcement has not received sufficient emphasis: “Against these globally operating tech and financial companies, the Netherlands is simply far too small,” Groothuizen said. “We inevitably need Europe to get such parties to work with us in the fight against illegal gambling.”
Efforts to Disrupt Offshore Infrastructure
KSA has stepped up its efforts to weaken the support structures of offshore gambling sites, collaborating with payment service providers and technology firms to make illicit operators more difficult to locate and fund. The regulator has also been able to issue fines reaching tens of millions of euros, but collecting these penalties proves challenging, as operators continually shift corporate structures and jurisdictions.
Dutch state lottery Nederlandse Loterij has initiated legal proceedings against three offshore sites in recent months to further combat these practices.
Groothuizen commented, “We are fighting a worldwide network of ruthless criminal organizations with dedicated neighborhood police officers, when we should actually be deploying an international investigative service,” and argued for stronger action at the European level.
FATF Highlights the Scope of the Challenge
The FATF’s September 9 warning drew attention to the extent of illegal gambling activity across more than 80 global jurisdictions. The FATF found that the illegal sector “rival or even exceed the size of legal gambling markets” in numerous markets, a finding echoed by Euromat, which has assessed Europe’s illegal gambling revenue at €12B ($14.1B).
The FATF noted instances where criminals have moved funds through gambling platforms without substantial betting activity, calling such channels “attractive gateways for fraudsters, professional money launderers, and organized criminal networks.” FATF President Giles Thomson urged authorities to intensify oversight and cross-border collaboration: “Without robust safeguards, these sectors can be attractive gateways for fraudsters, professional money launderers, and organized criminal networks,” FATF President Giles Thomson said. He added, “It is naive to cling to the idea that a well-regulated national legal market and a national regulator are enough to tackle this problem.”
Illegal Gambling: Key Financial Figures
| Jurisdiction | Estimated Annual Losses (Netherlands, Tax Revenue) | Estimated Illegal Market Revenue (Europe) |
|---|---|---|
| Netherlands | €500 million ($587 million) | N/A |
| Europe (Overall) | N/A | €12B ($14.1B) |
- Author
Daniel Williams
