On February 21, the government of Brazil published new rules tightening the payments rules to offshore operators.
The Finance Ministry’s Prize and Betting Secretariat (SPA) published an ordinance. It regulates how financial institutions and payment providers must handle unlicensed gambling companies.
Federal Law 14.790/2023 established the country’s new gambling market. It restricts financial institutions and payment providers from facilitating payments to offshore operators.
Article 21 of the law states that financial institutions, payment providers, and payment arrangement providers cannot maintain transactional accounts with illegal operators. The law also prohibits them from processing deposits and prize payments.
The new regulations require payment businesses to report any suspected illegal operations to the SPA within 24 hours.
The agency must submit the report through the Electronic Information System (SEI) and explain why the case is suspicious. It must also include the company’s registration number and corporate name.
According to Regis Dudena, SPA secretary, the new measure, together with the removal of illegal websites and advertisements, will be a fundamental reinforcement in the fight against those who want to operate without authorization and for the protection of bettors, as it aims to prevent these websites, which put people’s economy and finances at risk, from receiving financial resources, closing the circle of illegal activity.
The SPA will issue a formal order to the business if the SPA detects that any payments business is processing transactions for an unauthorized betting operator.
In this notification, the payments business must provide detailed transaction data and terminate its relationship with the unlicensed operator.
The payments company must ensure preventative measures are in place to prevent this from happening again. It must also immediately stop processing transactions for the illegal operator and close any related accounts.
This will require implementing systems and controls to stop future transactions with the unauthorized operator.
The ordinance allows authorities to contact law enforcement and financial regulators for serious cases. However, failure to take proactive measures could result in regulatory penalties.
