SIGA CEO: Gambling addiction in Brazil cannot be combatted by decree

Emanuel Macedo de Medeiros, global CEO of SIGA, criticised the ban on sports betting in Brazil after a regulatory process that, according to him, had brought the sector out of informality and made it an international benchmark.

In an exclusive interview with iGaming Business, the executive stated the provisional measure banning betting was adopted suddenly, without consulting the entities involved and without adequately assessing its effects.

According to Macedo, the first signs already point to a migration of bettors to the illegal market, where there are no consumer protection mechanisms, supervision or instruments to combat match-fixing.

He also foresees a financial impact on operators, investors, clubs and sports. All have become dependent on the revenue generated by the regulated market.

The CEO of SIGA argued the risks associated with gambling should be addressed through regulation, oversight, education and information, and not just through prohibition. In his assessment, Brazil needs to preserve legal stability, strengthen sports governance, and bring together government, integrity entities and industry representatives to build solutions capable of protecting players without pushing the activity underground.

iGaming Business – Brazil ended sports betting in the last week of September. How does this pose a risk to sports? How can integrity be maintained without all the measures that were taken beforehand – and in which SIGA itself participated – to make the market clean, safe and transparent?

Emanuel Macedo de Medeiros – This is an extremely important and crucial question, but it should be directed to those who took the initiative to prohibit sports betting. The Brazilian market was very well regulated, and I referenced it as an example to be followed by other jurisdictions. It was not an easy process, but a very successful one, with credit that should be given to those who were on the front lines. Especially to the Secretariat of Prizes and Bets, the Ministry of Sport and the sports community.

There has been a healthy effort and convergence to bring clarity and integrity to a market that previously lived in the shadows. This doesn’t mean the situation is perfect, because there are always problems, as in any industry, but the result is frankly positive. So positive that Brazil had approached international bodies, such as the Council of Europe, to adopt the Macolin Convention. It is the only international instrument that allows for some global strategic coherence and convergence.

Therefore, I do not question the legitimacy of the Brazilian president to make such a decision. He acted within his powers, according to his interpretation of the Constitution and the law. But the fact is that it raises the greatest concern and, moreover, the effects will soon be seen.

When people say there’s a migration to the black market, it’s already possible to confirm this. Just look at the upward trend in VPNs to find clear evidence that this isn’t just a fear. It’s a reality that’s already happening.

iGB – No protection for the player and with risks?

EMM – Without any protection for the player, although this was used as an argument to justify this last-minute measure. It was untimely, without prior notice and without prior consultation.

What happened, for example, in the United Kingdom? No one questions the concerns regarding responsible gaming. It is the duty of the entire sports cluster to mobilise efforts to reinforce the integrity, good reputation, credibility, health of bettors and physical integrity of all people involved.

But this couldn’t have been done without an inclusive consultation process involving all responsible entities in what would be a shared decision and responsibility. And, with that, SIGA was not consulted, nor were IBIA, Sportradar and Genius Sports. So, it strikes us as odd, because we signed two cooperation agreements with the government. One was with the Secretariat of Prizes and Bets and the other with the Ministry of Sport. We have the utmost respect and intellectual, professional and institutional recognition for all our partners. But there is no doubt that, like us, they must also have been surprised by this decision.

iGB – SIGA actively participated in this process. Is it frustrating to see what’s happening today?

EMM – It’s frustrating for me, with 33 years of experience in professional football. I’ve held CEO positions in all professional leagues in Europe and around the world. I know the state of the sport of football, and as global CEO of SIGA, I have an even deeper and broader understanding than I had before. There are dangers in this decision, which I think were not considered.

The potentially negative consequences of this decision could have been avoided, and we are already feeling the instability in the market. There is a migration from regulated to illegal gambling, a financial shock to companies and investors. They were invited to invest in a stable system, regulated by law, at the invitation of the Brazilian state. They invested BRL30 million plus BRL5 million to guarantee the operation.

We’re talking about a lot of money and a sector that did what was expected. A step forward was taken in terms of its own credibility, dignity and operating according to the rules, and then, from one moment to the next, the rug was pulled out from under its feet. This creates serious problems of economic viability for all those who made this investment. And it creates even greater problems of economic viability for Brazilian football and other sports.

There’s no point in having utopian dreams. Brazilian football is in a very delicate and vulnerable financial state. Due to a lack of regulation, leadership from the state and from the sporting movement itself, it’s incomprehensible that a country like Brazil doesn’t have a professional league capable of implementing adequate criteria for financial, sporting and infrastructure management, so that the country can reach its full potential. The regulator needs a strategic vision and a sense of leadership, and must implement the necessary legal framework to allow the representative structures of football or sport to make their own choices. Sport needs to move forward with a clear head and a clean slate. And those who work in it, those who invest in it, those who practice it, need to feel good about themselves and work in an honourable sector.

So, what’s happening? How is this possible? Even I, who am not Brazilian but feel as if I were, know the extraordinary role and contribution that sport plays socially, culturally and economically in Brazil. We’re not talking about just any country. We’re talking about the second largest economy in the Americas. Brazil is a nation with 213 million inhabitants and is part of the G20. In fact, it chaired the G20 not long ago. Therefore, how will the international community view Brazil after this situation?

What guarantees of stability can be given to those seeking to invest in Brazil, with a legal framework that changes suddenly, without prior consultation? And without even the most basic rules of good governance? Simply because there is fear and the indebtedness of individuals and the increase in gambling addiction are invoked. These risks exist in any other sector, such as alcohol and tobacco. The problem of illegality is not combatted by turning a regulated sector into a marginal sector.

iGB – Are you concerned about the negative impact of banning sports betting?

EMM – I wanted to say the following: we have absolutely no political motivations; we are totally independent and neutral. Our only commitment is to integrity in sport. Unfortunately, there are well-founded reasons to fear the negative impact of this measure if it goes ahead. Above political decisions are the law and the courts. What do I think should be done? It is necessary to recognise the problems and mobilise the various actors to work on solutions. Brazil needs to take a qualitative leap in sports governance, continuing the path it was on in legitimising sports betting. With a regulated, supervised, and scrutinised framework. I had the great opportunity to witness the commitment and competence of the government at the forefront of regulation. I repeat, I have pointed to the case of Brazil as an example of the success of good governance and good regulation. And this also has to do with the commitment of each of the people involved in this challenge.

It’s a decision whose motivations I understand, but it will create far more serious problems than those it seeks to solve. The problem of gambling addiction or indebtedness cannot be combatted by decree, but rather with concrete measures. The government has many instruments and means at its disposal to implement a proactive, impactful policy with positive results. Education, education, education, information, information, information—that’s what’s needed. It’s pointless to force people to comply with a law they lack the culture for or the predisposition to follow. This is a cultural challenge.

IGB – In the last two years, there has been a reduction in cases of match-fixing. Will this all fall apart in your assessment? Could we return to the top of the ranking of countries with the most match-fixing?

EMM – I don’t want to be fatalistic, nor do I want to advocate for the apocalypse. But we must be very aware of the perverse effects that a ban entails. I’m not saying this because of the Brazilian example, which is very recent. I’m saying this based on my 33 years of leadership in world football and sports governance. And with the clear conscience of someone who has never placed a sports bet. I have never been to a betting site, I am not advocating for it, nor am I speaking on behalf of betting companies. I am speaking on behalf of integrity and a global community that views this easy, sudden path without prior consultation with concern. It also did not involve all stakeholders. It was motivated by a haste that, at first glance, has no explanation and that could greatly compromise the integrity of the sport in Brazil.