The Brazilian Government has launched a new regulation aimed at curbing the advance of unauthorized betting platforms by blocking funds linked to illegal activity.
“No company that tries to offer illegal gambling will operate in this country,” said President Luiz Inácio Lula da Silva when announcing the signing of Decree No. 13,033, which requires banks to freeze resources coming from unlicensed online betting operations.
The measure regulates mechanisms provided for under the so-called Anti-Mafia Law and aims to prevent the circulation of resources derived from clandestine betting platforms and strengthen the fight against the financing of organized crime.
The decree authorizes the Secretariat of Prizes and Betting (SPA) of the Ministry of Finance to identify operators acting without authorization and notify financial institutions, payment institutions, and payment schemes so they can halt their economic activity.
Institutions must block, within up to 24 hours, the accounts associated with illegal operations, as well as implement mechanisms to prevent the development of new transactions.
The Central Bank will be informed simultaneously of the notifications in order to monitor compliance with the rulings and, in turn, will have up to 90 days to implement the electronic system that will centralize this communication, in coordination with the Secretariat of Prizes and Betting (SPA).
Until then, communications will be carried out through the federal Government’s Electronic Information System (SEI).
The identification of unauthorized betting houses may occur through inspection by the SPA itself, through complaints filed by third parties, or based on the analysis of information related to indications of electronic fraud.
Although the block takes immediate effect, the measure is defined in the text as precautionary and does not constitute a definitive sanction. Affected operators will have the right to contest the decision and to a full defense in a process conducted by the National Secretariat of Public Security, linked to the Ministry of Justice and Public Security.
After the conclusion of the administrative process, the Government may request that the courts transfer the frozen amounts to the National Public Security Fund.
According to the Minister of Finance, Dario Durigan, the Government has detected around three hundred operators behind nearly 50,000 betting sites removed from the internet, which used some thirty financial institutions to process their payments.