Brazil Targets Illegal Betting With New Financial Crackdown

Brazil has unveiled new measures to weaken the country’s illegal betting market by targeting the financial infrastructure used by unlicensed operators.

During a press conference, Finance Minister Dario Durigan announced a new decree signed by President Luiz Inácio Lula da Silva allowing authorities to freeze funds linked to illegal betting activities.

According to Durigan, Brazil’s legal betting market operates under strict oversight from the Secretariat of Prizes and Betting (SPA).

“Now, with the ordinance that imposes joint liability on financial institutions, we will have even more means to combat the illegal market. And the new decree will impose restrictions on transactions involving clandestine bets.”

Under the decree, banks, fintech companies and payment institutions will have 48 hours to freeze funds connected to betting operators that lack authorisation in Brazil. Banks and fintechs could face joint liability for transfers by illegal betting businesses.

Financial Institutions Face Greater Responsibility

Authorities hope the policy will disrupt illegal operators by restricting their access to the financial system. The SPA has identified a number of illegal websites and notified Brazil’s telecommunications regulator, Anatel, so the sites can be blocked.

Durigan said investigators discovered that illegal operators had relied on 37 fintech companies to process transactions.

“We are communicating with the federal police, Public Prosecutor’s offices, COAF (Council for Financial Activities Control) and the Federal Revenue Service so they can act against these illegal operations,” commented Durigan.

Government Pursues Financial Strangulation Strategy

Authorities intend to suspend the activities of fintech firms involved with illegal betting and pursue the expropriation of associated assets.

“This measure decisively strengthens the Brazilian state’s capacity to confront illegal operators. Those who operate outside the law cannot continue using the financial system to sustain clandestine businesses. By blocking the flow of funds in unauthorised betting operations, the regulation targets the economic core of illicit activities, reduces incentives for illegality and reinforces the government’s commitment to serious, effective regulation guided by the public interest,” he emphasised.

Justice Ministry Backs Zero-Tolerance Approach

Justice Minister Wellington César Lima e Silva backed the measures, warning that organised crime sees illegal betting as an attractive sector.

“It is essential that the government act strongly against this,” he affirmed. According to Wellington, the decree signed by President Lula “is a major step against illegal betting”.

He added that authorities would first target illegal operators through financial restrictions, describing the approach as cutting off the oxygen supply sustaining criminal organisations.

Brazil is cracking down on illegal operators by tackling the financial infrastructure that supports them. Therefore, the authorities will be freezing funds connected to illegal betting and suspending the activities of associated fintech firms.