New Delhi. Money laundering and terrorist funding is being carried out through illegal online betting and gambling companies. It is a matter of concern that such companies have also emerged as a threat to national security. A report by the Security and Scientific Technical Research Association of the National Defense University claims that illegal online betting and gambling increases the risk of Indian citizens getting trapped in cyber attacks and unsafe online environment.
The report also said that the current legal and regulatory framework does not adequately distinguish between legitimate and unlawful activities. Because of this, illegal online gaming platforms often serve as a means to promote other illegal activities, including money laundering and terrorist funding.
According to the report, there is no official estimate of the size of the betting and gambling market in India. However, a 2017 report by the International Center for Sports Security estimated that the illegal betting-gambling market in India is worth $150 billion (about Rs 10 lakh crore).
Need to implement IT Rules-2021
The IT Rules-2021 distinguish between online real money gaming and illegal betting-gambling practices. However, the report suggests creating a registration mechanism to whitelist legitimate online gaming platforms that comply with Indian law.
The report recommends the government to implement the IT Rules-2021 for online gaming intermediaries to create a legal distinction between legal online gaming and betting-gambling. The guidelines prepared for the regulation of online gaming have not been implemented yet.
Taking the help of surrogate advertising
The report claims that illegal online gaming platforms are misusing the RBI’s Liberalised Remittance Scheme (LRS). The report also mentions examples where these platforms are presenting themselves as grocery platforms. Also, surrogate advertising is also being used to circumvent existing rules. In surrogate advertising, companies advertise their other products or brands through another image. According to the 2023-24 Annual Complaint Report published by the Advertising Standards Council of India (ASCI), advertisements related to illegal betting have become one of the most problematic categories. They are in second place with 17 per cent.
