Brazil started blocking thousands of unauthorized online gambling sites on Friday in response to ongoing concerns over the rise of gambling addiction in the country.
As reported by the Associated Press, the move comes the same week President bLuiz Inacio Lula da Silva threatened to ban online gambling if regulation was unable to curb problem gambling.
Lula’s statements were prompted by a report on the number of low-income families spending money on gambling. A recent central bank report noted that recipients of the Bolsa Familia program spent 3 billion reais ($550 million) in August. Bolsa Familia is Brazil’s financial aid program for poor families.
The recent blocking of online betting sites was not a surprise. Last month, Finance Minister Fernando Haddad announced that beginning Oct. 1, online companies operating without government consent would be restricted, according to a Bloomberg report.
Brazil’s Secretariat of Prizes and Bets (SPA) identified 2,040 suspicious gambling domains and turned them over to the National Telecommunications Agency to be blocked. The Treasury department will continue to monitor their activity to be sure they don't return.
“This is a very important first step that will be further developed and will involve ongoing action by both the SPA and other government agencies to protect, above all, gamblers and the popular economy,” said Regis Dudena, secretary of prizes and betting for the Ministry of Finance.
Restricting illegal betting sites is just one of Brazil’s strategies to reduce gambling addiction. The country plans to ban the use of credit cards to fund gambling and prohibit gambling sites from offering credit.
Brazil plays catch-up
Some of Brazil’s issues with problem gambling stem from a long period without regulation.
Brazil legalized online gambling in 2018. However, the industry wasn’t taxed or regulated until Dec. 2023. During those five years, thousands of unregulated gambling websites popped up, attracting more than 50 million Brazilian bettors.
Earlier this year, more than 100 companies applied to operate in Brazil under the new regulations. Most of those companies will be allowed to operate in the country through the end of this year while their applications are reviewed. On Jan. 1, 2025, companies that receive final approval will be required to pay a license fee of $5.3 million.
