Brazil Industry Bodies Back Decree Freezing Illegal Betting Funds

Two of Brazil’s leading gaming associations have backed the federal government’s latest move against illegal betting. The Brazilian Institute for Responsible Gaming (IBJR) and the National Association of Games and Lotteries (ANJL) publicly supported Decree No 13,033/2026, signed by President Lula on June 19, 2026, which lets the state freeze and confiscate the funds of unlicensed betting operators by targeting the payment institutions that move their money.

Decree Forces Banks to Freeze Operator Funds Within 24 Hours

The decree, paired with the Finance Ministry’s Ordinance No 1,766/2026, shifts enforcement away from website blocking toward direct intervention in payment flows. When the Secretariat of Prizes and Bets (SPA) flags an illegal operator, banks and payment firms must freeze the linked accounts within 24 hours and halt new transactions, then confirm compliance within 48 hours, according to reporting by Rio Times and Reuters. 

Brazil’s central bank oversees the process, and funds declared forfeit are directed to the National Public Security Fund. The regulations also establish joint liability for financial institutions, payment companies and advertisers in collecting taxes tied to irregular fixed-odds betting. The government named 37 financial firms, mostly fintechs and payment companies, as conduits for illegal-bet money.

Illegal Sites Draw 25.2 Million Brazilian Bettors

The scale of the problem is large. Justice Minister Wellington César Lima said 25.2 million Brazilians have bet on illegal websites. Research by the Locomotiva Institute with LCA puts the illegal market at roughly BRL40 billion ($7.7 billion) a year, costing public coffers an estimated BRL10.8 billion annually, IBJR president Carlos Lima said. ANJL president Plínio Lemos Jorge said the figure shows the scale of the challenge and described the decree as the product of “an environment of dialogue and institutional cooperation.” Lima added that the measure “directly contributes to increasing the safety of bettors” while protecting operators that act within the law.

Clandestine Operators Skip the Checks Licensed Firms Must Pass

Illegal betting accounts for between 41% and 51% of all betting activity in Brazil, by the government’s own estimates. Clandestine operators sustain that share by skipping the identity and age checks licensed firms must perform and by routing deposits through payment channels that escape monitoring. By extending liability to the financial institutions and payment companies that process those flows, the decree makes the payment layer responsible for distinguishing legitimate operators from unlicensed ones. That places a verification and monitoring burden on firms that previously treated betting transactions as ordinary payments.

Verification and Monitoring Separate Legal Operators From Illegal Ones

Payment institutions and licensed operators in Brazil now need to confirm who they are serving and trace where funds originate, not simply process transactions. That requires identity verification that confirms a bettor’s identity and age at onboarding, alongside screening that flags suspicious flows and sanctioned or unlicensed counterparties.

Shufti’s KYC and AML screening solutions support document verification across 240+ countries and AML checks, combining biometric identity verification with ongoing transaction and watchlist screening to help regulated firms separate legitimate activity from illicit money movement. Financial institutions and operators adjusting to the new liability rules can request a demo to see the platform in action.