Watson, an outspoken critic of the gambling sector in Great Britain, has confirmed on social media he wrote to Culture Secretary Jeremy Wright because "over one third [of operators] are failing their customers."
The Gambling Commission last week fined four online casino operators £4.5m ($5.8m) in total, with the biggest individual fine within that category amounting to £2.2m.
The Times, which gained access to Watson’s letter, has quoted its own research to show online casinos pay £120m to sponsor Premier League football clubs overall, while only contributing £50 per team to Britain’s biggest gambling charity.
Watson is quoted as writing in the letter: "A gambling license should be a hallmark of credibility and trust. It should not be seen as an opportunity for operators to push the limits of their conditions and responsibilities.
"The regulator cannot be in a position where it is continually playing catch-up to an opaque and agile global industry. We need a structured response to the situation. This will require a total overhaul of our register of current remote sector licenses.
"This review would be an opportunity for existing remote license holders to re-apply for the privilege of operating and marketing in the UK."