To strengthen the supervision of illegal gambling activities, the Lottery and Gambling Bureau (SPA) under the Ministry of Finance of Brazil recently announced that it has officially launched a mandatory reporting mechanism for banks and financial institutions, requiring them to report suspicious transactions suspected of providing account services to "illegal gambling platforms".
According to official reports, since the new regulations took effect, the SPA has received 9 suspicious account reports, with a total of 32 accounts involved being frozen.
Currently, only 159 gambling platforms have been authorized by the government to operate, all ending with the domain ".bet.br". From October 2024, unlicensed online gambling platforms within Brazil will be considered illegal.
In response to illegal platforms constantly "changing skins and shells" and circumventing blocks, the government has taken large-scale technical blocking actions, blocking over 11,000 illegal gambling websites so far. However, SPA head Regis Dudena admits: "This is a necessary step, but it is not enough."
Banks must report suspicious accounts within 24 hours
According to the new rules, all banks, payment institutions, and financial technology companies must report to the Ministry of Finance within 24 hours of detecting suspicious account activities, whether the account is in the name of an individual or a company. The report must include:
Account holder identity information
Details of the suspected transaction
Measures taken (such as freezing or closing the account)
Dudena states: "Financial institutions must fulfill their legal obligations to assist the government in tracking the flow of illegal gambling funds, which is an important part of protecting the public's economic interests."
Furthermore, the Ministry of Finance also conducts "undercover tests" by establishing accounts and initiating transfers on illegal gambling websites to identify institutions providing financial channels and issue timely administrative notices.
The National Association of Gambling and Lotteries (ANJL) of Brazil is also involved in the detection operations, and has so far helped identify nearly 10,000 illegal gambling platforms.
Non-compliant institutions may be fined up to 2 billion reais
For financial institutions that refuse to cooperate or fail to report as required, the Ministry of Finance can take multiple disciplinary measures, including:
Formal warning
Heavy fines, up to 2 billion reais
Suspension or prohibition of participation in government procurement and financial cooperation projects
"Gambling is essentially spending money for entertainment, not a tool for making money"
Despite the strengthened supervision, Dudena emphasizes: "This action is not aimed at ordinary bettors, but to combat illegal operations and money laundering, to prevent the public from suffering losses."
He frankly states: "The essence of gambling is a way to 'spend money for excitement', not a means to gain income. The public needs to realize this sooner."
According to estimates by the Central Bank of Brazil, the national expenditure on online gambling ranges from 20 billion to 30 billion reais per month. This data was disclosed by Deputy Governor Gabriel Galípolo and Executive Secretary Rogério Lucca at the Senate Special Committee on the Impact of Online Gambling (CPI) hearing on April 8.
The CPI was established at the end of 2024, aimed at investigating the impact of online gambling on family budgets and potential risks of money laundering and organized crime connections.
The gambling industry brings high authorization revenues, tax data pending
According to the Ministry of Finance, as of now, the fixed odds gambling industry has brought about 2 billion reais in authorization revenue to the federal government. Each operating authorization costs 30 million reais, with a maximum of three gambling platforms allowed. Currently, 71 companies hold 73 licenses, with a total of 159 platforms.
The tax department states that related tax revenues are still being compiled and are expected to be officially announced in the coming months.
