Brazil starts cracking down on illegal online gambling as addiction concerns grow

Brazil began blocking more than 2,000 betting websites it designated as illegal on Friday as part of a government push to regulate the sector, after concerns grew about gambling addicts, especially vulnerable people.

SAO PAUL — Brazil began blocking more than 2,000 betting websites it designated as illegal on Friday as part of a government push to regulate the sector, after concerns grew about gambling addicts, especially vulnerable people.

Authorities have begun enforcing a law signed by President Luiz Inácio Lula da Silva in December 2023 that regulates and taxes betting companies.

Currently, 96 companies that have 210 gambling websites are still active. The federal government said in a statement that these companies have demonstrated a willingness to comply with the new legislation and can operate until the end of the year while their license applications are reviewed.

Starting January 1, 2025, companies with operational authorization will have to pay 30 million reais ($5.3 million) and permanently comply with federal rules to curb fraud, money laundering and abusive advertising to stay in business.

Dario Durigan, executive secretary of the Ministry of Finance, said the government hopes to protect the integrity of players with these measures.

Brazil legalized online gambling in 2018, but the lack of regulation has raised concerns among financial and health authorities. Psychiatrists have reported an increase in gambling addiction, while banks have seen an increase in related expenses.

The Central Bank of Brazil estimates that Brazilians wager about 20 billion reais ($3.5 billion) on bets every month. This includes beneficiaries of the federal cash transfer welfare program Bolsa Família (family subsidy), which spent 3 billion reais ($530 million) on online gambling in August.

At the end of September, the federal government announced plans to implement measures to prevent social benefits from being used for gambling. These programs were designed to guarantee food security and cover the basic needs of vulnerable families.