Illegal Betting Sites Multiply in Brazil Within Days of Lula’s Gambling Ban

Brazil’s prohibition on online betting has been followed almost immediately by a surge of illegal gambling operations, underscoring the enforcement challenges facing the country after President Luiz Inácio Lula da Silva signed a decree banning fixed-odds sports betting and online casino games.

The Bet Legal platform, which monitors unlicensed gambling activity in Brazil, identified the creation of 415 new illegal betting sites in the immediate aftermath of the ban’s publication, with nearly 300 appearing within a single day. The figures suggest that unlicensed operators are moving quickly to fill the space vacated by the regulated market, which had been operational since January 2025.

Authorities have reportedly taken down 506 platforms in connection with the crackdown, but the pace of new site creation indicates that enforcement alone is unlikely to eliminate offshore operations targeting Brazilian consumers.

Background to the Ban

Brazil legalized fixed-odds sports betting in 2018, and Congress extended the framework to online casino games in 2023 during Lula’s administration. The regulated regime formally launched in January 2025, requiring licensed operators to meet compliance, tax, and responsible gambling obligations. Last year, licensed platforms recorded approximately R$37 billion (around US$7 billion) in activity, serving an estimated 25 million users.

The ban, issued by provisional measure on 25 September, arrives just over a week before the first round of the presidential election on 4 October. The president has characterized the industry as a problem requiring removal, framing the measure as a response to gambling-related household debt and addiction.

Under the decree, betting sites and applications are due to go offline on 6 October. The measure prohibits offering, brokering, and advertising covered betting products, including services based abroad that target consumers in Brazil. It also establishes a transition process requiring the return of account balances, qualifying winnings, and unresolved bets. Lottery formats authorized under existing law are exempt from the prohibition.

Industry Response

The sector has responded with concern. Licensed operators have argued that the ban disregards the substantial investments made under the legal framework and risks pushing players toward unregulated alternatives. Betting companies have indicated they will pursue compensation for licenses obtained under the prior regime.

Representatives of Brazilian football have also raised objections, warning that a change in the law would be an “open door for illegal betting” and a blow to clubs that rely heavily on betting sponsorship. Betting operators have been among the largest commercial sponsors of Brazilian football in recent years.

Corporate fallout is already visible. DigiPlus Interactive has announced it is winding down its online gaming operations in Brazil following the decree, while other operators are reassessing their financial forecasts for the region.