Illicit Gambling Websites Continue Processing Payments Through Mastercard and Visa, Defying Ban Orders
Wrangle with Gambling: Mastercard and Visa Face Heat Over Payment Processing to Illegal Sites
Published on: 10.03.2025. Last updated: 30.04.2025.
By Russ Leary and Ava Newman
Credit Card Payments Slide through to Illegal Gambling Hubs
In a jaw-dropping disclosure, it appears that Mastercard and Visa have found a loophole that enabled payments on unlicensed gambling sites despite a ban. An investigation by Investigate Europe and reported in The Guardian [English link] has exposed this unsavory truth.
Despite the 2014 agreement with the UK Gambling Commission to stop such transactions, credit card providers have been found on several unregulated gambling sites. Nine such sites listed Mastercard, while Visa was available on two. Both companies pocketed a small fee per transaction they processed.
"It's like an iceberg. The legal gambling industry is visible above the waterline. Everything else, operated without a license, is beneath it"- Ismail Vali, analyst at Yield Sec, Investigate Europe.
Personal data and financial risk weren't the only worries for players on these sites. Complaints about refused payouts or deleted accounts without warning were common. The Gambling Commission recorded at least 922 complaints about unlicensed providers in the last two years.
Flickering in the Shadows: The Unregulated Gambling Universe
With millions of visits from the UK between October and December 2024, the five most popular unregulated sites were easy to find in search results and advertised on social media. Customers of FatPirate claimed to have won 6,000 GBP (around 7,100 EUR) but were unable to access their money. One account on Gransino was even deleted after a user complained about refused payouts.
A silent war seems to be going on in the gambling industry. The legal sector, tightly monitored and regulated, battles against its criminal counterpart. Between them, players risk not only their money but also their personal data, which could end up in the wrong hands.
The Dance with Devils: Mastercard, Visa, and Authorities Stumble
Both Mastercard and Visa have issued statements denouncing illegal activities, claiming they will investigate the cases in question. However, they pointed fingers at banks, stating it's their responsibility to ensure merchants follow the rules.
During the investigation, it was discovered that payments were processed by a system called PaymentIQ, a so-called payment orchestration that allowed gambling sites to route transactions through various financial institutions to maximize approval chances. Worldline, the company behind PaymentIQ, stated that it was a neutral software solution with no direct control over customer accounts or payment processing.
The UK Gambling Commission highlights the issue, having issued over 770 cease and desist orders and reported over 100,000 websites to Google for removal. Critics argue that both Mastercard and Visa should take immediate action to consistently prevent illegal transactions.
A Cautionary Tale: The German Perspective
From Germany, credit card payments could be made on some illegal sites, just like on legal ones. Although payment service providers are not allowed to process transactions for illegal gambling providers, it still occurs occasionally. Players risk legal consequences, including fines or imprisonment of up to six months for participating in unlicensed online gambling.
Moreover, banks are not obligated to refund authorized credit card payments to illegal providers, making it difficult for players to recover their lost funds.
The Federal Court of Justice also advises players to avoid unregulated sites, as they pose a particularly high risk for problem gamblers, who can quickly and uncontrollably make high stakes without feeling the immediate financial consequences.
Illegal Gambling and Addiction: A Growing Concern in the UK
The Betting & Gaming Council estimates that British players gamble over £2.7 billion (around €3.21 billion) annually on unregulated sites. As the issue persists, the Gambling Commission is stepping up efforts to combat the black market, but it remains unclear why payment service providers haven't enforced their own obligations so far.
Today, millions of players unwittingly indulge in the dangerous world of unregulated gambling, fueled by payment providers like Mastercard and Visa. Faced with mounting public and regulatory scrutiny, one must wonder whether these giants will tighten their controls, or will they continue to play the game of chance with players' hard-earned money and their personal safety?
- What about the small fees Mastercard and Visa pocketed per transaction on unlicensed gambling sites? It seems they were happy to facilitate such transactions despite the law.
- The investigation revealed that credit card providers like Mastercard and Visa were found on several unregulated gambling sites, demonstrate a lack of commitment to stopping illegal activities in the gambling industry.
- The unregulated gambling universe is shadowy and risky, offering consumers not only the chance to lose their money but also their personal data, as customers of FatPirate and Gransino found out.
- Authorities have taken notice of the lax attitude of Mastercard and Visa in dealing with illegal gambling providers, questioning why payment service providers haven't enforced their own obligations to prevent such transactions.
- The growing concern in the UK is that millions of players are unknowingly entering the dangerous world of unregulated gambling, fueled by payment providers like Mastercard and Visa, who seem reluctant to tighten their controls and protect consumers from potential harm.
