The Dark Side of Online Gambling: How Unlicensed Operators Use Big Tech to Target Minors

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Published: 21 August 2024

3 min

Exploring the murky waters of online gambling, a recent Barron investigation with Similarweb sheds light on how overseas gambling platforms are using Big Tech ads to lure in an astonishing number of visitors, many of whom are minors, into the risky world of skin gambling.

Key Takeaways

27 overseas gambling platforms spent $28 million on Google Search ads in the past three years, attracting 56 million visitors.
Many of these platforms violated Big Tech regulations by operating without a license, putting minors at risk.
Skin gambling, which uses virtual items from games as currency, is promoted, leveraging the popularity of the Counter-Strike game.
Minors are especially vulnerable to gambling ads, with social media introducing them to gambling earlier than ever.
Despite strict policies from Google, Meta, and Twitch against gambling and skin gambling ads, these continue to appear on their platforms.
Examples include Singapore-based online casino Hellcase, which spent millions on ads despite lacking essential age verification procedures.
In Australia, CSGORoll was targeted by the Australian Communications and Media Authority but continued to advertise via Google, revealing deep flaws in ad regulation enforcement.

In a comprehensive investigation conducted by Barron in collaboration with web traffic analytics giant Similarweb, a concerning pattern has emerged from the shadows of the online gambling industry.

Over the past three years, 27 overseas gambling platforms have poured approximately $28 million into Google Search ads to draw in a staggering 56 million visitors. What makes this situation alarming is not just the vast sums of money and traffic involved but the fact that the majority of these platforms were unlicensed, breaching Big Tech’s strict advertising policies, and, more distressingly, targeting minors with their ads.

Skin Gambling: A Legal Gray Area

Skin gambling stands at the heart of this controversy. This form of gambling allows players to bet using virtual goods, or “skins,” from video games, particularly from the popular game Counter-Strike (CS).

These skins, which can fetch thousands of dollars on third-party marketplaces, are used as currency in games of chance, blurring the lines between virtual play and real-life gambling.

This is especially problematic when it comes to minors, who are inherently more susceptible to the lures and risks of gambling.

A Vulnerable Youth

Experts like Mark Griffiths, from Nottingham Trent University, and Rob Minnick, who counsels on gambling addiction, highlight the enhanced vulnerability of minors to gambling and its advertising.

Minnick’s observations on social media’s role in introducing gambling to children at a prematurely young age are particularly concerning. With adolescence itself being a risk factor for developing gambling problems, the aggressive advertising strategies of these platforms could not come at a worse time.

Big Tech’s Policies vs Reality

While Big Tech companies like Google, Meta (formerly Facebook), and Twitch have established firm policies against gambling and skin gambling advertising, the effectiveness of these policies is in question.

Despite clear rules against such practices, investigations have found ongoing advertising efforts from unlicensed gambling platforms on these very platforms. For instance, Hellcase, a Singapore-based online casino, heavily invested in Facebook, Instagram, and Google Search campaigns, alongside collaborations with YouTube influencers, to attract millions despite violating mandatory age verification norms.

Regulatory Challenges Down Under

The situation is not much better in Australia, where the Australian Communications and Media Authority (ACMA) took action against skin gambling site CSGORoll for violating gambling laws. Despite regulatory interventions, Google continued to serve ads for CSGORoll, illustrating the complexities and challenges of effectively enforcing these regulations.

The Takeaway

The Barron-Similarweb investigation highlights the struggles within the digital advertising space to curtail the proliferation of unlicensed gambling platforms, particularly those that endanger minors.

The discrepancy between Big Tech’s gambling ad policies and the reality of their enforcement underscores an urgent need for tighter controls and more vigilant oversight. As the online gambling landscape continues to evolve, the priority must be to protect the most vulnerable among us, ensuring that the digital world remains a safe space for all.