As part of the Gambling Commission’s ongoing efforts to combat financial crime in the UK gambling sector, its latest emerging risk update (October 2025) highlights the continued and evolving risks posed by pre-payment methods.

This serves as a critical reminder to operators to review their money laundering and terrorist financing (“MLTF”) risk assessments and related policies, procedures and controls.

Why this matters

Under licence condition 12.1.1(3) of the Gambling Commission’s Licence Conditions and Codes of Practice, operators are required to remain informed of emerging MLTF risks, ensuring that such policies, procedures and controls are updated as needed, implemented effectively, and remain effective, taking into account any guidelines published by the Gambling Commission from time to time.

The Gambling Commission’s October 2025 update reinforces earlier emerging risks bulletins published in April 2020 and February 2022 and the Gambling Commission’s 2023 MLTF Risk Assessment, which classified pre-paid payment methods as high risk.

Pre-paid payment methods: Key risk factors

The Gambling Commission considers pre-paid payment methods as high risk due to a variety of factors, including:

• Merging of funds – the ability to pre-pay or pre-load using cash and, in some cases cryptoassets either directly or through third party websites.
• Anonymity – the anonymous nature of some pre-paid payment methods and lack of traceability.
• Credit card circumvention – the ability, in some cases, to pre-pay using credit cards.
• Deposits – the open-loop nature of pre-paid methods often do not allow deposits back onto the original card or voucher.

What operators need to do

1. Update your MLTF risk assessment

In accordance with licence condition 12.1.1, licensees must consider all payment methods in their MLTF risk assessment, including pre-paid cards and pre-paid vouchers. This October 2025 emerging risk bulletin notes that the Gambling Commission’s expectation is that pre-paid payment methods should be treated as high risk, in accordance with the Gambling Commission’s own risk assessment.

2. Conduct appropriate customer profiling and due diligence checks 

The use of pre-paid payment methods must be factored into a customer’s risk profile, and the operator must conduct appropriate due diligence checks. Additional ‘know your customer’ (“KYC”) and source of funds/source of wealth checks are also expected to be conducted by the operator when a customer is identified as presenting a higher risk.

The Gambling Commission reminds operators that they are ultimately responsible for ensuring sufficient customer checks are conducted and that they must not rely on a third party payment processor to conduct such checks on their behalf, or rely on third parties to establish source of funds without scrutiny.

3. Submit a key event notification (if appropriate)

Licence condition 15.2.1(8) requires operators to submit a key event to the Gambling Commission where there are any changes to the methods by which, and/or the payment processors through which, the licensee accepts payment from customers using their gambling facilities. The Gambling Commission expects such key event notifications to contain the following information as a minimum:

• The type of payment method.
• The provider.
• How the payment method was assessed in the operator’s MLTF risk assessment.

4. Do not accept payment by credit card

The Gambling Commission reminds licensees that under licence condition 6.1.2(1) they must not accept payment for gambling by credit card, including payments to the licensee made by credit card through a money service business or top up methods for pre-paid cards. Operators must ensure that where pre-paid methods are authorised, they are not used to circumvent this restriction.

5. Review and update policies and procedures

Licence condition 12.1.1(2) requires that following completion of, and having regard to, the MLTF risk assessment, licensees must ensure that they have appropriate policies, procedures and controls to prevent money laundering and terrorist financing. Licensees must therefore ensure that whenever they update their MLTF risk assessments, their anti-money laundering (“AML”) policies, procedures and controls are also reviewed and updated as needed. 

Next steps

Please get in touch with us if you have any questions or would like further advice on updating your AML policies and procedures, and  sign up to our blog to make sure you receive updates on any emerging MLTF risks.