AI: Balancing Benefits and Risks in the Gambling Industry
Artificial intelligence (“AI”) is one of the biggest technological innovations of the 21st century and is already changing the way in which we live. All industries are in the process of working out how AI can help them and identifying the risks which it may pose – the gambling industry included. In addition, the gambling industry is itself continuing to experience a period of change. For a sustained period now, gambling regulation has been increasing and adapting to new technologies and new markets.
In this article, we have outlined potential areas which may benefit from AI, along with corresponding risks to which those areas may be susceptible.
Security vs Gambling Bots
Improving security and monitoring irregularities in play is an area which can be greatly improved by the use of AI. AI enables operators to analyse historic data, learn patterns and anomalies in behaviour, and therefore efficiently identify and act on current patterns that may be fraudulent. Operators can also use AI to implement sanctions on accounts showing suspicious activity on a 24/7 basis, making it significantly more efficient than human operators.
Whilst the ability to analyse behaviour will assist operators with tackling fraud, it allows bots to do the same. Users can use bots to scrape betting data to enable users to capitalise on the best odds. Further, users can use multiple bots to play games, ensuring that one bot wins against other bots. It is becoming increasingly difficult for operators to identify gambling bots, and their existence may be seen as unjust for human players who are incapable of matching the analytical skill of the bots. Operators will have to ensure that effective KYC checks are in place (and may use AI to do so) to ensure that gambling bots are identified and their accounts cancelled.
Safer Gambling vs Privacy
The ability of AI to monitor gameplay also lends itself to assist with safer gambling. AI can effectively identify patterns of play which may suggest a user is showing signs of problem gambling.
In the UK, the Gambling White Paper proposes two new financial risk checks – a financial vulnerability check (to be used for customers with “moderate rates of spend”) and a more detailed financial risk assessment (to be used for customers who may suffer with binge gambling or significant unaffordable losses over time). On 27 February 2025, the threshold at which operators must conduct financial vulnerability checks decreased from £500 net deposits in a 30 day period to £150 net deposits in a 30 day period in a pilot to test whether such lower amounts would be practicable. AI could assist operators with implementing these checks and may even go beyond them to identify problem behaviours at an even earlier stage (i.e., not having to wait until the 30 day period is complete). In addition to the identification of problem gambling, AI can go further, allowing operators to automatically impose remedies (such as suspensions) or offer vulnerable customers help and information on responsible gambling. It may, however, be prudent to ensure that any such use of AI is paired with human intervention to ensure that customers are assisted in a considerate and empathetic manner, meaning they feel supported to engage in safer gambling habits.
Safer gambling is always a top priority for regulators and governments alike, and so the ability of AI to improve this is undoubtedly a benefit. However, another priority for governments in recent years has also been privacy. Since the introduction of the GDPR, privacy and data protection, and the protection of these, has been a hot topic of conversation in all industries. There may be valid concerns that the use of AI to conduct checks in the ways mentioned above may infringe the privacy rights of users. The AI will have access to a significant amount of personal data of millions of users which will be shared between several parties in order to identify problem gambling and carry out the relevant financial risk checks. Operators will need to be certain that they have adequate agreements in place with third parties which cover things such as data protection/privacy and confidentiality, and have adequate warranties and indemnities included to ensure protection. Further, they will need to obtain the relevant consents (or rely on other legitimate bases) from users to ensure no privacy rights are breached.
Personalisation vs Problem Gambling
Perhaps one of the most exciting use cases of AI for both users and operators is the ability to personalise gameplay. For example, an AI tool could analyse the playing history and preferences of a particular user and adapt the game to ensure that it is as exciting and engaging for the user as possible, giving each user a tailored gaming experience. Furthermore, AI could identify user preferences to ensure that an operator’s marketing to that particular user contains tailored promotions, incentives and bonuses. It can easily identify if a user may have an affiliation to a particular team, player, match or sport. All of these things will make marketing more effective for the operator.
Furthermore, and whilst not technically a personalisation, AI can also be used to offer new and improved odds calculations. By analysing both historical data and a large range of present data, AI can potentially allow operators to offer more accurate odds in a wider range of circumstances (for example, on likely weather conditions and individual player performance) and improved in-play betting opportunities, thus improving the user experience.
Whilst the factors above will improve user engagement and satisfaction, and therefore could improve loyalty and retention, they may also increase the likelihood of a user participating in problem gambling. Personalisation in both gameplay and marketing may encourage excessive gambling. In the UK, operators have an obligation under RTS 14 to “ensure that products are designed responsibly and to minimise the likelihood that they exploit or encourage problem gambling behaviour”. Operators will need to ensure that they implement protections and have sufficient evidence of doing so to prevent themselves falling in breach of this obligation.
Conclusion
AI presents both significant opportunities and notable risks for the gambling industry. From enhancing security and safer gambling measures to enabling personalisation and more accurate odds, AI has the potential to revolutionise the way gambling operators interact with users. However, these benefits come with corresponding challenges, such as the rise of gambling bots, concerns over data privacy, and the potential for AI-driven personalisation to encourage problem gambling.
As AI continues to evolve, regulators and operators must strike a careful balance—leveraging AI’s capabilities while implementing safeguards to protect players and maintain fairness. Responsible deployment of AI, coupled with robust regulations, will be crucial to ensuring that the technology serves to enhance the gambling experience rather than create new risks. Ultimately, the future of AI in gambling will depend on how well the industry can navigate these complexities, ensuring that innovation goes hand in hand with integrity and user protection.
