Brazil’s Black Market Adds 415 Illegal Gambling Sites After Lula’s Ban on Online Wagering

Brazil’s illegal gambling market moved fast after President Lula da Silva announced Provisional Measure 1,394, with Bet Legal reporting more than 415 new illegal gambling websites since Friday, September 25. For licensed operators and their PSPs, the immediate problem is simple: if regulated online wagering is blocked, traffic does not vanish — it shifts to whoever can keep taking bets.

1. Provisional Measure 1,394 was described as Lula’s unilateral decision to effectively kill the gambling industry in Brazil, banning all forms of online wagering with immediate effect. The measure entered into force immediately, blocking operators from accepting new customers, but Congress has a 120-day window to ratify it if it is to become permanent.
2. According to Bet Legal, the illegal market has already seized on the disruption. A survey conducted with Iron Security identified 415 new illegal betting sites in just a few days after the announcement, which is exactly the kind of vacuum black market operators are built to fill.
3. The National Association of Games and Lotteries (ANJL) pushed back, warning the President’s office that the measure does little to address illegal gambling and may instead help it grow by removing the regulated alternative. ANJL president Plínio Lemos Jorge said the black market would take advantage of the opportunity and expand its offer proportionately.
4. ANJL estimates that at least 30 million gamblers will now be left with no alternative other than the illegal gambling market. For payments teams, that means a larger pool of traffic flowing toward unlicensed operators, which tends to put pressure on monitoring, fraud controls, and merchant screening on the legal side.
5. The government has already responded by taking down 506 websites through the Ministries of Justice and Finance. The catch, as the source notes, is that black market operators are used to ISP blocks and often run mirror domains or backup copies, so takedowns alone are a temporary inconvenience rather than a clean shutdown.

There is also a political timing issue here: most experts quoted in the source do not expect a permanent disruption, since Congress is not seen as likely to simply rubber-stamp a measure taken without lawmakers’ consent. In practice, Brazil’s iGaming and sports betting market has already taken a hit, and licensed operators will carry that cost for as long as the ban lasts.