Some gambling companies are using a legal loophole to induce punters to gamble online while regulators are cracking down on others.

NSW passed laws in July 2018 banning the promotion or inducement to gamble, although an exemption allows such advertising on racing websites.

Free bet offers to sign up to gambling websites are illegal in NSW unless they are on a racing website. Credit:Racenet.com.au

Since then, 19 prosecutions have caught online gambling companies breaking this law by using other sites such as on Apple’s app store.

Regulators are cracking down on these companies with prosecutions running twice a month on average since July last year but the fines are a mere "cost of doing business", critics say.