BRL1.33bn stranded as Brazil’s bookmakers go dark

• Brazil’s Ministry of Justice confirms licensed sites and apps went offline yesterday on October 6.
• Banks must automatically refund BRL1.325bn to about 26.5 million bettors.
• ANJL and IBJR are challenging an order to redirect operator traffic to a state portal.

Brazil’s licensed betting operators went offline on Tuesday, October 6, with BRL1.325bn still owed to about 26.5 million bettors, according to the Ministry of Justice.

The shutdown is the first hard deadline of President Luiz Inácio Lula da Silva’s fixed-odds betting ban. It has also sparked a Supreme Court fight over whether the government can force operators to send their traffic to a state website.

Refunds on autopilot

The Ministry of Justice confirmed on Tuesday that platforms had complied with Provisional Measure 1,394/2026. Of the 188 sites licensed until Monday, only one was still running. The ministry said a block on that site had already been requested.

The voluntary withdrawal window closed at 23:59 on October 5. Bettors withdrew BRL775.6m in the ten days after the measure was published, according to Treasury figures.

The BRL1.325bn still to be returned comes from Secretariat of Prizes and Betting (SPA) data, and most of it sits in a small number of accounts. The ministry says 86.2 million accounts hold between BRL0.01 and BRL0.99, adding up to just BRL15.5m. One person can hold accounts on several platforms, so accounts outnumber bettors.

At the other end of the scale, 1% of accounts hold about 80% of the money, roughly BRL1.06bn, according to Treasury data. The Ministry of Justice says accounts with high balances will be investigated for possible money laundering and links to organized crime.

Bettors do not need to file a claim. Operators have until October 7 to send each bank the outstanding balance for every CPF, together with the account used for deposits. Banks must then pay out between October 9 and 14.

From October 14, any refund that hits an obstacle moves to state-owned Caixa Econômica Federal, which handles the final payment. The government’s Brasil sem Bets portal tells users the refunds are automatic. It also directs anyone who has not been paid by then to Caixa.

The text of the measure requires refund money to stay ring-fenced from company assets, with daily fines of BRL200,000 for non-compliance. Operators remain liable for any shortfall. Making that work depends on matching each CPF to the account used for deposits. Where that account has been closed, the measure allows payment into another account in the bettor’s name.

Ordinance SPA/MF 3,005, which regulates the wind-down, says nothing about bonus balances or bettors without a registered bank account. Open bets without a result by the deadline are void, and stakes must be returned in full. Bets settled before the cut-off still pay out.

Operators’ obligations continue after the sites go dark. They must hold player, betting and payment records for at least five years. Their anti-money laundering, responsible gambling and sports integrity duties also remain in force. The ordinance sets December 15 as the deadline for settling all remaining obligations, including statutory levies.

Whose traffic is it?

On October 2 and 3, the Ministry of Justice and Public Security’s digital rights secretariat sent letters to operators. These order them to point all traffic from their domains, subdomains, IP addresses and APIs to brasilsembets.gov.br from 00:01 on October 6. The order covers apps on phones, computers and smart TVs.

The portal is now live. It shows visitors an “access blocked” notice and explains the refund timetable. It also links to a form for reporting betting sites that are still operating, and points users to gambling support through Brazil’s public health service.

The measure gives ministers a legal basis for intervening. Article 23 lets the Finance and Justice ministries request the blocking or redirection of betting sites. Telecoms regulator Anatel and Brazil’s internet steering committee, CGI.br, carry out blocking orders.

The National Association of Games and Lotteries (ANJL) and the Brazilian Institute of Responsible Gambling (IBJR) do not dispute that power in general. Their objection is narrower. They argue the measure only obliges operators to make their platforms unavailable. In their view, forcing companies to steer their own users to a government page is a new duty created by letter.

They raised that argument with Supreme Court Justice Luiz Fux in an urgent petition on October 3.

The associations estimate the redirect could hand the government around 100 million visits a day. They also question the legal basis for the state collecting visitors’ IP addresses and device data under Brazil’s data protection law. ANJL has advised its members not to implement the order, and some operators have said they will not comply.

Six cases, one judge

The redirect petition is only one strand of a wider legal fight. On October 2, Fux was named rapporteur for three new constitutional challenges to the measure:

• ADI 8,024, filed by Anseja
• ADI 8,027, filed by ANJL
• ADI 8,028, filed by a national association of mayors and deputy mayors

He already oversees three earlier cases against the 2023 betting law. Clubs including Flamengo, Fluminense, Botafogo and Cruzeiro have joined ADI 8,027 as friends of the court. Broadcasters’ association Abert has asked to join as well.

On the same day, Fux gave the Office of the Advocate General of the Union (AGU) 72 hours to respond in the original case. Advocate General Jorge Messias signed the reply at 19:40 on October 5. It asks Fux to reject the injunction requests and keep the measure in force. It also asks him to hear the Prosecutor General’s Office within 72 hours and to consider a fresh public hearing.

ANJL and IBJR responded on Tuesday, asking Fux to suspend the ban until any such hearing takes place. No ruling suspending the measure had been reported as of the morning of October 7.

BRL2.55bn up in smoke

Between January 2025 and March 2026, 83 companies paid BRL2.55bn for 85 five-year authorizations, according to the ANJL and IBJR petition.

Article 4 of the measure terminates those authorizations on October 25, 30 days after publication. It rules out any refund of the fees or compensation, citing the public interest.

The sector paid BRL8.94bn in federal taxes in 2025 and BRL6.32bn between January and August 2026, according to Federal Revenue Service data. Finance Minister Dario Durigan has said licensed operators moved about BRL600m a day before the ban.

The AGU’s filing estimates a federal revenue loss of BRL1.54bn in 2026, rising to more than BRL5bn a year in 2027 and 2028.

Clones outrun the blocklist

Operators argue the ban removes licensed supply but leaves demand untouched. An LCA study commissioned by IBJR put the illegal market at 41% to 51% of total betting before the measure.

The AGU’s filing accepts that range. It also concedes that rebuilding an illegal site costs very little compared with what the state spends taking one down. The industry petition cited 833 new illegal sites launched since the ban, based on bet-legal.org monitoring.

The government is pursuing illegal operators on several fronts. The Ministry of Justice says 13,241 illegal sites were referred for blocking between September 25 and October 6. It has also asked platforms to remove 3,552 pages, profiles, channels and groups, including 1,974 Facebook pages and 900 Telegram channels and groups.

Those referrals follow earlier sweeps that removed tens of thousands of illegal betting sites. Article 14 of the measure bars banks and payment institutions from processing any betting transaction other than refunds.

ANJL president Plínio Lemos Jorge says the government has not published how many addresses have actually been blocked. In his assessment, new sites appear minutes after each takedown.

The associations also point to the safeguards that close with the licensed market. These include more than 1.2 million self-exclusion requests logged under the regulated regime.

Football loses its paymaster

Betting companies paid BRL1.1bn to Brazil’s main clubs in 2025, equal to 36% of their marketing revenue, according to government data. Every sponsorship logo had to come down by October 5.

Operators used their last weekend of visibility to protest. During São Paulo v Santos and Atlético-MG v Bragantino, ANJL and IBJR members turned over pitchside boards to the slogans “To prohibit is not to protect” and “The ban doesn’t end gambling”.

Plínio Lemos Jorge said:

“For ANJL and IBJR, maintaining a regulated environment with clear rules and legal certainty is fundamental so that clubs, companies and other agents in the sports chain can plan their long-term investments.”

Runoff day reckoning

Flávio Bolsonaro took 47.03% of valid votes in the first round on October 4, ahead of Lula on 45.16%. The two meet in an October 25 runoff, the same day every betting authorization is formally terminated.

Members of Lula’s campaign believe the ban cost him votes, according to reports in the Brazilian press. The AGU’s court filing cites a Datafolha survey showing 78% public support for the prohibition.

Congress has 120 days to approve the measure. Congress president Davi Alcolumbre has extended the deadline for amendments to October 13, and 42 have been filed so far. One, from Congressman Pedro Aihara, would limit the ban to slot games and keep sports betting legal.

The associations warn that a late vote may make little difference. They point to Article 62 of the constitution, under which legal relationships formed while a provisional measure is in force remain governed by it, even if Congress later rejects the text.

By the time lawmakers vote, refunds will have been paid, databases handed over and sponsorships cancelled.

That makes the Supreme Court the industry’s fastest potential route to relief. A ruling on the redirect would show whether Fux is willing to restrict one of the government’s enforcement tools now that the shutdown has begun. A ruling on the wider challenges would decide whether any licensed market is left for Congress to save.