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Millions of people across North America wager money online every day, placing bets on sports, playing casino-style games and participating in prediction markets. However, confusion surrounding online gambling laws and regulations creates opportunities for bad actors to exploit the system.A new Better Business Bureau study found that a risky underbelly of pseudo-gambling, illegal gambling and fraud has developed alongside the online gambling and gaming industry. From 2022 to mid-2025, the BBB received nearly 200 scam reports and more than 10,000 business complaints related to online gambling and gaming.In some cases, people lost tens of thousands of dollars—either because they misunderstood the rules and their state’s laws, or because a scammer stole their money.
Gambling laws vary by state and can be difficult to navigate. Scammers often use sophisticated tactics, making it hard to distinguish a legitimate company from a fraudulent one.In Missouri and Illinois, there are highly regulated and fully legal options for gambling and gaming—such as state lotteries and in-person casinos—but online gaming remains limited. The BBB recommends verifying the legality of a service in your state before using it.
Red Flags to Watch For in Gambling and Gaming Services
Big promises around payouts
Tempting ads that lack details
Businesses based overseas
Sweepstakes-style games
Payment through cryptocurrency
Typos in company names
How to Avoid Issues with Gambling and Gaming Companies
Know your local laws. Gambling laws vary by jurisdiction. Understand your state or provincial laws before engaging with any gambling service.Missouri: Online gambling is not currently legal. However, due to the passage of Amendment 2, online sports betting will be permitted starting Dec. 1, 2025.
Illinois: Online gambling is not legal.
Check for proper licensing. If your state allows gambling, it may restrict which websites can operate legally. Check with your state’s regulatory agency—such as the Missouri Gaming Commission or the Illinois Gaming Board—for a list of licensed operators.
Read the fine print. Terms around winning and withdrawal may differ from first impressions. Understand how the service operates before sending money.
Know your rights. Even legitimate websites may freeze winnings. Understand the platform’s rules and what actions to take if your account is frozen.
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