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Brazil’s Ministry of Finance will continue to take action against betting bookies operating illegally as the Minister aims to bolster the country’s regulated betting industry. During a hearing of the Chamber of Deputies’ External Committee on Piracy Acts on August 11, the Secretariat of Prizes and Betting (SPA/MF) shared the measures implemented to combat illegal operators, financial transactions, and online sites.
Fixed-odds betting has been legal in Brazil since 2018 under Law 13,756/18, and the 2023 Betting Law (Law 14,790/23) established additional state control mechanisms. The government started with manual controls and began automating the blocking of illegal websites in October, according to Carlos Renato Resende, Undersecretary for Monitoring and Enforcement. Over 60,000 websites are reportedly blocked.
Financial Controls Become a Key Focus
Eliminating illegal gambling is not that simple, Resende said: “Nowhere in the world has an illegal market been completely eradicated. In Brazil, we have other markets subject to piracy, and the difficulty is the same.”
The government is also coordinating with Brazil’s financial system to create further measures to thwart the ability of illegal betting businesses to launder money through the financial system. The Anti-Faction and Organized Crime Law established procedures for dealing with the money laundering risks of unauthorised operators, and new financial rules were anticipated based on consultations with the National Financial System.
Authorities also announced measures to block funds connected to illegal companies and potentially compensate victims of fraud. Resende explained: “When this money is blocked, the affected consumer may come forward and prove that part of this money belongs to them, so they can be compensated. At the end of the process, if the legal entity cannot prove the lawful origin of the money, the funds will be forfeited to the Brazilian state and allocated to the National Public Security Fund to combat crime in general.”
TCU Calls for Coordinated Enforcement
The measures proposed to Congress are partially related to recommendations made by Decision 1296/26, of Brazil’s Federal Court of Accounts (TCU), approved in May. Wesley Vaz, Secretary of External Governance Control at the TCU, urged the coordinated action of the Ministry of Finance, Central Bank, Federal Revenue Service, National Telecommunications Agency (Anatel) and Federal Police.
According to Vaz, “There is a need for the state to better block domains, interrupt financial flows, and sanction illegal operators.” The recommendation reflects the increasingly interconnected nature of illegal betting, where enforcement requires action across telecommunications, financial, tax, and law enforcement systems.
Illegal Market Still Represents Significant Share
Some new research by Instituto Locomotiva estimates that the illegal betting market represents 38% to 41% of Brazil’s betting market. Researchers said the illegal portion continues to be substantial even though it’s better than the previous estimate by the institute of 41% to 51%.
Eric Brasil, director at LCA Consultoria, said: “What this represents, in a simple estimate, is an 11% decline in the illegal market. The good news is that the illegal market appears to be shrinking. What is concerning is that, when compared with other jurisdictions and countries, we still have a very large illegal market.”
The survey was carried out in May with 2,291 individuals in Brazil. The estimated illegal share in Ireland was the lowest at 3%, Australia was 15%, and Mexico was 20%.
Regulated Operators Face Stricter Controls
The Brazilian Institute of Responsible Gaming (IBJR) pointed out that there are already some controls that licensed betting operators are required to implement. These include traceable payments; facial biometric identification; age restrictions on bets (no bet is accepted by anyone under 18); tax payments; anti-money laundering systems in the house, and reports of suspicious transactions.
Consumer risks from uncontrolled betting also were discussed in the hearing. Uncontrolled betting activity was associated by Letícia Ferraz, director of the Laboratory of Human Rights and New Technologies (Labsul), with over-indebtedness, mental health issues and other negative repercussions. The lab will create an educational guide on protecting bettors and consumers.
Brazil’s ongoing strategy, then, is to move towards domain blocking, financial enforcement, regulatory oversight and consumer protection. The other challenge is to minimize the illegal market while maintaining that enforcement action is in step with a market in which operators try to find ways around the rules.
Source: BNL Data
