Failing to Prevent Fraud is not an Option

Why even none-UK based Gambling Operators, affiliates, and third party service providers need to up their game under the Economic Crime and Corporate Transparency Act.

The Economic Crime and Corporate Transparency Act creates new liability for gambling operators

The UK Economic Crime and Corporate Transparency Act 2023 (ECCTA) introduces a game-changing “failure to prevent fraud” offence that came into force on September 1, 2025. For gambling and gaming operators who may question its relevance to their highly-regulated sector, the Act creates an entirely new layer of corporate criminal liability that extends far beyond existing compliance frameworks.

Who’s covered and what’s at stake

The offence applies to “large organisations” meeting two of three criteria: more than 250 employees, over £36 million turnover, or over £18 million in total assets. This captures most major gambling operators, whether UK-based or offshore. The penalty? Unlimited fines and serious reputational damage that could threaten business viability.

Unlike traditional corporate criminal liability requiring proof of “directing mind and will,” ECCTA creates strict liability. Organisations are guilty if an “associated person” commits fraud intending to benefit the company – unless they can prove they had “reasonable prevention procedures” in place.

Your business ecosystem creates widespread exposure

The Act’s definition of “associated persons” extends far beyond employees to encompass the complex web of relationships that characterise modern gambling operations. This includes affiliates, payment processors, software providers, agents, and third-party service providers who perform services “for or on behalf of” your organisation. Consider common gambling industry scenarios: an affiliate using fraudulent marketing to drive player acquisition, or a payment processor’s employee facilitating fraudulent transactions. Under ECCTA, these actions could trigger criminal liability for the principal organisation.

Extraterritorial reach affects offshore operators

Many offshore operators assume geographic distance provides protection. The Act’s broad extraterritorial reach means non-UK organisations remain liable where there’s a “UK nexus” – including UK-based employees committing fraud, fraudulent activity targeting UK customers, or any part of fraudulent conduct occurring in the UK.

Industry-specific fraud risks demand targeted responses

Gambling operators face unique fraud vulnerabilities that ECCTA specifically addresses. In particular through sales and marketing channels. The message is simple if sales or marketing persons deliberately lie or fail to mention relevant information in order to win sales then that is fraud. If your sales person offers or receives an inducement in order to progress a sale, that could be regarded as a bribe. Do your sales and marketing teams know where to draw the line? Could your managers be inciting fraud and bribery in their teams by pushing them to achieve unattainable targets?

Deliberate falsification of information, deliberately failing to disclose relevant information and the deliberate sharing of information known to be false amounts to fraud. This opens up the possibility that individuals and organisations they are associated with could face criminal prosecution under ECCTA. Offering or receiving bribes is a criminal offence and opens up the possibility that individuals and organisations they are associated with could face criminal prosecution under the UK Bribery Act.

UK Gambling Commission expectations are clear

The UK Gambling Commission has issued specific guidance reminding licensees of their obligations under ECCTA. The Commission emphasises that while targeting large organisations, the fraud prevention principles represent good practice for all operators. Crucially, ECCTA requirements exist separately from existing License Conditions and Codes of Practice – existing compliance measures alone won’t suffice.

Action required: the six-principle framework

The Home Office guidance establishes six core principles for “reasonable prevention procedures”: top-level commitment, risk assessment, proportionate prevention procedures, due diligence, communication and training, and monitoring and review.

The bottom line

ECCTA isn’t just another compliance requirement – it’s a fundamental shift requiring gambling operators and those providing services soon their behalf to implement comprehensive, industry-specific fraud prevention frameworks. The Act’s broad scope, unlimited penalties, and strict liability standard make it impossible to ignore. Organisations that act decisively now can turn compliance into competitive advantage, while those that delay face potentially catastrophic consequences.

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ECCTA – One page explainer for a sceptical board

ECCTA – Fraud Typologies Analysis

Helpful links to the specific reports we have utilised in the above assessment.

Official Government Resources

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