Illegitimate Gambling Platforms Continue to Accept Transactions Via Mastercard and Visa Despite Prohibitions

Unmasking the Shadowy World of Unlicensed Gambling: Mastercard, Visa Face Heat Over Alleged Illegal Transactions

Illegal Gambling Sites Thrive Under the Nose of Card Giants Mastercard and Visa

In a staggering revelation, an investigation by Investigate Europe—as reported in The Guardian—has shed light on the continuous processing of payments for unlicensed gambling sites by the two payment giants, Mastercard, and Visa. These sites offer games of chance and live sports betting, even though they don't possess a valid gambling license.

"The gambling industry is like an iceberg—above the waterline, the legal industry is visible. But it floats in a sea of crime."- Ismail Vali, analyst at Yield Sec, Investigate Europe

While these card providers agreed in 2014, voluntarily, to thwart such transactions, they remained accessible on several unregulated gambling sites. Mastercard graced the list of nine such sites, whereas Visa was present on two platforms. Both companies reaped profits from a small fee per transaction.

Unregulated Platforms Flood the Market

As these sites operated without a license, they managed to sneak into search results and were promoted on social media. Between October and December 2024, the five most popular sites attracted a staggering four million visits from the UK alone.

The Gambling Commission received numerous complaints, with some platforms refusing to pay out winnings or arbitrarily deleting user accounts without warning. A customer of the FatPirate site claimed to have won 6,000 GBP (approximately 7,100 EUR) but was unable to recover their money. A user even witnessed the complete deletion of their account on Gransino, after they reported refused payouts.

To date, the Gambling Commission has accounted for at least 922 complaints about unlicensed providers over the last two years. Experts warn that customers dealing with these platforms not only risk losing their money but also expose their personal data, which can be exploited or sold by criminals.

Gambling aficionados could use Mastercard and Visa to pay on illegal sites. © lil artsy/Pexels

dual reactions from Mastercard, Visa, and the Authorities

Both Mastercard and Visa have responded to the allegations, maintaining that they don't support illegal activities within their networks and will investigate the reported cases. It was discovered that payments were channeled through a system known as PaymentIQ. This so-called payment orchestration enables gambling sites to offset transactions through several financial institutions to increase the chances of approval. Worldline, the company behind PaymentIQ, clarified that it is a neutral software solution that doesn't control customer accounts or payment processing directly.

Unregulated Gambling Sites in Germany

From Germany, credit card payments are theoretically feasible on some illegal sites, much like legal ones. Though payment service providers are not permitted to process transactions for illegal gambling providers, such incidents still occur occasionally.

However, German participants risk legal repercussions. Engaging in unlicensed online gambling is illegal and can lead to fines or imprisonment of up to six months.

The Federal Court of Justice has ruled that banks do not have to refund authorized credit card payments to illegal providers - lost money tends to stay lost. Cautious individuals are advised to stick with providers holding a valid German license, which can be located via the Joint Gambling Authority of the States’ whitelist.

Problem gamblers should particularly avoid credit card payments in online gambling, as they facilitate quick and unlimited high-stakes without immediate financial consequences.

Although the UK Gambling Commission has emphasized that it has already issued over 770 cease and desist orders and reported over 100,000 websites to Google for removal, many of the identified gambling sites continue to function actively. Offering customers welcome bonuses of up to £1,800 (approximately €2,100) and hundreds of free spins, these sites remain operational despite regulatory attempts.

Critics might castigate payment service providers for lending legitimacy to unlicensed gambling sites through their services. Iain Duncan Smith, chairman of the parliamentary group for gambling reform, expressed concern over the findings and called on Mastercard and Visa to step up their efforts to consistently prevent illegal transactions.

While the Gambling Commission strengthens its battle against the black market, it remains uncertain why payment service providers have not yet implemented their own obligations.

Meanwhile, illegal gambling sites and gambling addiction are significant issues in the country. The Betting & Gaming Council estimates that British players gamble over £2.7 billion (approximately 3.21 billion EUR) annually on unregulated sites.

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Regulatory and Industry Responses

UK Gambling Commission Enforcement: The UK Gambling Commission has highlighted the dangers associated with unlicensed gambling sites, warning consumers that such platforms increase the risk of fraud and financial harm. Moreover, these platforms don't provide consumers with protections such as self-exclusion or responsible gambling tools. They actively pursue enforcement against illegal operators, and advise consumers to use only licensed sites, which can be verified via the UKGC’s public register.
Removal of Unlicensed Apps and Websites: Regulators remove unlicensed gambling apps and websites from app stores, digital ads, and search results. In the year 2025 alone, Dutch regulators took action by removing 20 unlicensed gambling apps, and similar enforcement actions are expected in the UK.
Payment Processor Compliance: Payment networks like Mastercard and Visa generally require merchants to acquire proper gambling licenses and to engage in legal gambling transactions only. Their merchant agreements prohibit use for illegal gambling, and they reserve the right to terminate relationships with merchants that violate these rules.

Although the UK Gambling Commission has previously agreed with Mastercard and Visa to thwart illegal gambling transactions, these payments were channeled through a system called PaymentIQ, enabling unlicensed gambling sites to bypass the block.
In an attempt to recover their winnings, a customer of the FatPirate unlicensed gambling site claimed to have lost approximately 7,100 EUR, highlighting the potential financial losses and fraud associated with such sites.
As these unlicensed gambling sites have been found to operate without regulatory protections like self-exclusion or responsible gambling tools, critics argue that payment service providers like Mastercard and Visa are inadvertently lending legitimacy to these platforms when they facilitate transactions on them.