Brazil Puts 37 Fintechs Under Scrutiny Over Illegal Betting Flows

Brazil’s Secretariat of Prizes and Betting (SPA), under the Ministry of Finance, and the Federal Revenue Service have notified 37 fintech companies suspected of moving funds tied to irregular betting operators. For payment providers, the message is straightforward: once a regulator starts treating payment rails as part of the enforcement perimeter, the settlement problem becomes a compliance problem.

1. According to Folha de S.Paulo, the fintechs in question processed payments for 160 sites operating without authorization in Brazil. They must cut ties with those operators and block transactions linked to them, with any retained funds transferred to the National Treasury.
2. In parallel, the executive branch shut down 54 websites dedicated to illegal betting, using an agreement with Anatel (the National Telecommunications Agency). The government did not disclose the names of the notified companies or the amounts involved, saying it did not want to affect ongoing investigations.
3. The move is based on a decree signed by President Lula in June 2026, which brings back mechanisms similar to those used in the Anti-Fraud Law against organized crime. Under the decree, funds of illegal origin can be blocked, and fintechs that fail to comply can be held jointly liable. The companies could also face fines calculated on the total amount of the irregular transactions.
4. No asset freezes have been applied yet. The Ministry of Finance gave financial institutions until the end of August to align with the new rule; after that, each notification will be followed by an immediate freeze of funds and an investigation by the Ministry of Justice, which will determine the sanctions.
5. The government turned to this route after attempts to involve the Central Bank failed. An official source said that, according to the Central Bank itself, the usual procedure is to send the freeze request, but execution remains in the hands of each financial institution. If the institution does nothing, the regulator can issue only a warning, with no direct sanctioning power.

The market backdrop is large enough to matter. The executive branch estimates that between 41% and 51% of active betting sites in Brazil operate without a license, serving an estimated 25.2 million users. Unlicensed operators avoid the roughly $5.5 million license fee required by the Treasury, do not pay taxes, and do not follow responsible advertising rules or player self-exclusion mechanisms. Licensed operators, by contrast, must be based in Brazil, keep a reserve of about $910.000 to guarantee prize payments, pay a 12% tax on net winnings, and use the “.bet” domain in their web addresses.