The Betting and Gaming Council has warned that illegal operators captured approximately £60 million in wagers during this year’s Cheltenham Festival. That works out at roughly £2 million per race across the four-day meeting. The figure underscores growing concerns about the scale of Britain’s unlicensed betting market, and it comes at a time when regulatory pressure on legitimate operators continues to intensify.

Cheltenham attracts close to £1 billion in total stakes during Festival week, making it the crown jewel of Britain’s £11 billion annual horse racing betting market. The BGC estimates that around 6% of all British betting now flows through illegal channels. During racing’s biggest week, that share translates into tens of millions disappearing from the regulated sector.

Regulatory Pressure Creating Space for Black Market Growth

Grainne Hurst, Chief Executive of the Betting and Gaming Council, acknowledged that millions of punters placed bets safely with licensed operators. But she warned that the criminal black market is exploiting gaps left by increasingly restrictive regulation. “Rising taxes and increasingly intrusive checks will only make it harder for legitimate operators to compete,” Hurst said. “The priority must be keeping punters in the regulated market where protections are in place, rather than driving them towards harmful unregulated operators.”

The concern centres on two big regulatory shifts. The government’s 2023 white paper introduced affordability checks that require some bettors to hand over personal financial details before placing larger wagers. Worth knowing: the Jockey Club has warned these measures could drain £250 million from horse racing over five years, as customers migrate to unlicensed sites to avoid disclosure requirements.

Tax Increases Add Further Competitive Strain

Tax policy is compounding the challenge. From April, remote gaming duty will double from 21% to 40%. Remote sports betting duty is scheduled to climb from 15% to 25% in 2027. These increases create a real cost disadvantage for licensed UK operators competing against offshore sites that operate outside the tax net and without the compliance burden of British regulation.

The BGC argues that this combination of higher taxes and intrusive customer checks makes the regulated market less competitive precisely when government policy should be focused on keeping punters within licensed channels. The trade body has called for stronger enforcement action against criminal operators. Plus, they want a regulatory approach that balances consumer protection with the commercial viability of legitimate firms.

With £8 billion placed legally online each year, the Cheltenham figures show how much revenue is at stake. The Festival serves as an annual stress test for Britain’s betting market structure. This year’s results suggest the regulatory environment is creating opportunities for unlicensed operators to expand their foothold in a market that should be among the most tightly controlled in the world.

What the team thinks

Sheena McAllister says:

The £60 million figure is alarming but highlights what we’ve been saying for years: heavy restrictions on licensed operators don’t eliminate gambling demand, they simply push punters toward unregulated alternatives with zero consumer protections. While the UKGC intensifies compliance requirements on legitimate businesses, these illegal operators face no affordability checks, no safer gambling interventions, and pay no tax to support research and treatment. If we’re serious about protecting consumers, we need enforcement resources diverted toward shutting down black market operators rather than continuously tightening the noose on compliant businesses already operating under the world’s strictest regime.