Lula signs decree to freeze funds from illegal betting in Brazil and tax influencers who promote them

Brazil has moved from takedowns to payment blocking. A new decree signed by President Lula orders the freeze of money moved by illegal betting operators in Brazil, with confiscated funds going to the National Public Security Fund. For PSPs, banks, and fintechs, the key point is simple: the state is now pushing financial institutions to act inside tight deadlines.

1. The decree gives the Secretaria de Prêmios e Apostas the job of identifying illegal sports betting companies and notifying the financial institutions holding their funds. Banks and fintechs then have 24 hours to block the account and up to 48 hours to confirm the freeze.
2. After that, the Secretaria Nacional de Segurança Pública opens an administrative proceeding. The betting companies have 15 days to present a defense, and the Advocacia-Geral da União will go to court to seek forfeiture and the permanent transfer of the funds to the public security budget.
3. Robinson Barreirinhas, the head of the Receita Federal, said influencers who promote illegal bets will now also have to pay income tax on that activity. For operators and affiliates, that means the promotion side of the business is no longer being treated as a side note.
4. Since October 2024, Anatel has already taken down about 50,000 illegal betting websites and apps in the country. The 350 operators behind those sites were also blocked, and the Fazenda reported the illegal activity of 37 financial institutions, mostly fintechs, to COAF, the Public Prosecutor’s Office, and the Federal Police.
5. Finance Minister Dario Durigan said those institutions are repeat offenders and under Federal Police investigation. Justice Minister Wellington César said the measure is meant to choke off criminal organizations financially and that it is only possible under the anti-faction law.

The decree came one day after Operation “Conto da Sorte,” carried out by the Receita Federal and public prosecutors, which is investigating a billion-real money laundering scheme involving unauthorized betting in Pernambuco, Ceará, and São Paulo.