Visa, Mastercard linked to illegal gambling websites scamming UK customers
What's the story
Mastercard and Visa are under scrutiny for reportedly allowing transactions on illegal gambling websites that have defrauded UK customers.
According to an investigation by Investigate Europe, the payment giants have failed to prevent their networks from being used for transactions on unlicensed sites, despite a previous pledge to do so.
The investigation found Mastercard as a payment option on nine websites targeting UK customers with casino games and live sports betting offers last week.
Customer complaints
Customers report significant losses on unlicensed sites
Visa was also discovered to be a payment option on two of these sites.
Reportedly, both companies earn a small fee for every transaction passing through their networks.
The investigation has revealed several customer complaints about these unlicensed sites, including cases of huge financial loss.
One customer claimed they lost about £60,000 and were left suicidal after unwittingly gambling on an unlicensed site.
Regulatory concerns
Unlicensed sites attract millions of UK visitors
The unlicensed sites in question lack the required gambling licenses by law, but continue to show up in search listings and are promoted on social media.
The five most popular sites among these drew about four million UK visits between last October and December.
These findings raise questions over the regulators' ability to combat these sites, which have been associated with alleged scams and continue to accept card payments from UK customers.
Company statements
Mastercard and Visa's response to illegal transactions
Both Mastercard and Visa have said they prohibit illegal activity on their networks and will investigate the allegations.
The Gambling Commission, which regulates gambling in UK, also said it was aware of these sites and would "continue to take action against them."
Despite a 2014 voluntary arrangement with the Gambling Commission to block payments linked to unlicensed operators, the Observer found evidence that these companies are still facilitating payments for high-traffic illicit websites.
Regulatory actions
Gambling Commission's efforts to combat unlicensed market
As part of its efforts to disrupt the unlicensed market, the Gambling Commission has issued "over 770 cease and desist notices" and referred more than 100,000 URLs to Google for removal in the past 11 months.
However, many of the identified sites were still accessible last week and still offered deals in sterling, including welcome bonuses of up to £1,800 and hundreds of free spins.