Germany Grapples With Surge in Illegal Gambling as Operators Warn of Regulatory Imbalance

Legal companies such as Merkur Group and Löwen Entertainment argue that increasingly strict rules are pushing players away from regulated venues and into the illegal market.

According to industry estimates, Germany currently has around 160,000 legal gambling machines in operation. However, between 60,000 and more than 100,000 machines are believed to be operating illegally, highlighting the scale of the issue. Authorities have acknowledged the rise in unlawful activity, even as enforcement efforts have intensified. In North Rhine-Westphalia alone, police uncovered approximately 350 illegal gambling events over the past year, including unauthorized poker games and illicit slot machine operations.

Law enforcement agencies have also carried out major crackdowns. In one recent operation in Berlin, around 400 officers—including police, prosecutors, and customs and tax investigators—raided 74 locations across the city. The operation resulted in the seizure of 120 illegal slot machines, underlining both the reach of illegal networks and the resources required to combat them.

Industry representatives believe the regulatory framework is partly to blame. Manfred Stoffers, Vice Chief Executive of Merkur, stated that strict compliance requirements are driving customers toward illegal operators, who often ignore rules entirely and offer gambling in unlicensed venues without player protections. From his perspective, the imbalance creates an uneven playing field that disadvantages legal businesses.

On the political side, opinions remain divided. Sebastian Fiedler, domestic policy spokesperson for the SPD parliamentary group, emphasized the need for consistent action against illegal gambling. At the same time, he called for tighter oversight of legal gambling venues, including stricter location-based regulations. Fiedler rejected claims that expanding legal gambling would reduce illegal activity, arguing instead that it could increase overall participation and associated risks.

The debate was also reflected at the 23rd Gambling Symposium at the University of Hohenheim, where Ronald Benter from the GGL discussed the ongoing evaluation of Germany’s State Treaty on Gambling.

Experts warn that finding the right balance is crucial: overly strict rules may weaken the legal market, while overly lenient policies could increase gambling-related harm.