Regulatory flaw lets illegal betting sites evade Central Bank
The sports betting industry in Brazil faces a new regulatory challenge following the identification of a loophole that allows illegal sites to move funds beyond the reach of the Central Bank. According to the Secretariat of Prizes and Bets (SPA), under the Ministry of Finance, these platforms use payment institutions (PIs) that, by operating below certain financial thresholds, do not require formal authorization from the Central Bank. This situation facilitates the circulation of funds even after repeated domain and bank account blocks.
Regis Dudena, Secretary of Prizes and Bets, explained in a recent interview that the practice is already under SPA’s scrutiny and that the institutions involved will face consequences. Dudena warned: “These institutions are beginning to realize that if they act illegally, this will be taken into account when they apply for full authorization to operate by the Central Bank. We have already notified them and, in repeat cases, reports are also forwarded to the Federal Police.”
The regulatory gap originates from current regulations, which require Central Bank authorization only for payment institutions that move more than R$ 500 million in 12 months and maintain at least R$ 50 million in prepaid accounts. Below these values, PIs are outside direct supervision, which has been exploited by unauthorized betting sites to maintain their clandestine operations.
Dudena emphasized that the SPA acts as the sector’s regulatory authority and is tightening the net on institutions that facilitate illegal activities. “What we are doing is showing these institutions that the Secretariat of Prizes and Bets is also a regulator. It is useless to think they will only have to answer to the Central Bank. If they are identified as financing illegal activities, this will be recorded in their history,” he stressed.
Since the regulation of the betting market in January 2025, 78 companies have received authorization to operate and 17.7 million Brazilians have registered on 182 licensed platforms. During this period, the SPA, in cooperation with the National Telecommunications Agency (Anatel), has taken down 15,463 illegal betting sites and ordered the blocking of bank accounts linked to irregular operations. In the last six months alone, the SPA closed 255 bettor accounts and 45 company accounts.
Last Sunday, August 31, the Brazilian Institute of Responsible Gaming (IBJR) launched a campaign to alert users about the dangers of illegal betting. In the communication, the protagonist compares irregular platforms to a “goat in the room,” using the expression to illustrate a problem impossible to ignore. The message is reinforced with the image of a goat emitting the sound “bet.”
The goal is to raise public awareness about the differences between licensed platforms and those operating clandestinely. Additionally, the IBJR created the Betalert site, where citizens can verify if a brand is illegal by entering the platform’s address. The fight against illegal gambling in Brazil is intensifying, with the SPA and other entities strengthening oversight and promoting user education to protect the regulated market and consumers.
Tags: Brasil, SPA, regulation, betting, IBJR