The reason why casinos is being regulated is not to protect consumers. If it was for consumers sake, then what have they been doing to help those addicted gamblers and in which way are they helping to promote the knowledge of responsible gambling? I believe that their main reason for regulations is tax collection and monitoring of money laundering issues.
We have seen thousands of scam accusation complaints on the internet. How many of them were resolved? In most cases, the scam happens once the user wins a hefty amount of money in a casino. They do not scam a hundred dollars; they always target big amounts, which are usually bigger than a thousand dollars. Sometimes, it's life-changing money for some people. But since it's an online casino, players usually don't know what to do and where to complain.
Only a tiny percentage of players create scam accusations in the forums, and some others end up contacting mediator services like Ask Gambler and Casino Guru. Imagine the real number of players who got scammed but never got any help from anyone. Has the license provider ever audited any casinos? I don't think so.
I agree that government regulation focuses more on taxation and controlling money laundering than protecting users. But I think protecting users is not as easy as we think, how much manpower will they need to handle thousands of gambling complaints every day? Lack of manpower can be a barrier for the government as there are thousands of more important issues to deal with instead of spending all of its time and manpower on solving gambling problems.
Also, even if the government imposes tax regulations, but how many people comply with the regulations and voluntarily pay taxes? Or do most of us find ways to circumvent the law, evade taxes, but when something unfortunate happens, we ask the government to protect us? In this case, it is clear that the fault lies with both sides, not just the government.
The government collects taxes but fails to fulfill its responsibility to protect consumers, while players do not want to pay taxes but want comprehensive protection from the government.