Brazil Ministry of Justice creates division within Federal Police to combat illegal betting
The Ministry of Justice published on Tuesday a decree that created a division in the Federal Police to combat illegal betting.
Decree MJSP 1,325 created the Division for the Repression of Illegal Betting and Sports Manipulation (Drame). It will be within the structure of the Directorate of Investigation and Combat against Organised Crime and Corruption (Dicor).
Until then, the investigation and combat of illegal betting had been carried out by an interministerial committee. Drame incorporates the Betting Analysis Service (SEAAP) into its structure.
The Brazilian sports betting and online gaming market struggled for 22 months with illegal websites that do not respect the rules to which legal betting sites are subject. Throughout this time, the sector insisted that illegal gambling had to be combatted.
Trying to dry ice. And now, without a towel
The government failed to meet the sector’s demands, except for sporadic measures to block clandestine websites.
It was a struggling effort, and now, with the ban on betting by Provisional Measure 1,394, the Federal Police will have to perform this function, but without the resources previously generated by betting. The problem is likely to continue to grow, and the Federal Police could also struggle to contain the expansion of illegal activities.
In July of this year, Congress approved allocating up to 3% to the Fund for Equipping and Operationalising the Core Activities of the Federal Police (Funapol). This would come from the direct tax on bets, which was 16% this year. Starting in 2027, it would increase to 17%, and in 2028 it would reach 18%.
With the enactment of the provisional measure, the Federal Police will have an arduous task in investigating and combating illegal betting, but without appropriate resources to do so. The agency will have to cut spending in other areas, or it will not be able to fulfill the mission of Drame.
By creating its own structure to combat illegal betting, the government is once again demonstrating its lack of vision regarding the regulated sector. With an estimated BRL15 billion in revenue this year, shutting down the betting sector has cut off a source of income. And now it will have to open some kind of tap for the new division to receive funds to operate.
Manipulation of results
In addition to combatting illegal betting, Drame will be responsible for investigating crimes of match-fixing in sports. The National Secretariat for Sports Betting of the Ministry of Sports had this responsibility before the provisional measure on betting. Both it and the Secretariat of Prizes and Bets had established important agreements with international bodies to combat match-fixing. The Federal Police itself had established Base Apostas, which also acted against match-fixing and fraud in betting.
The ministerial decree also alters other structures within the Ministry, not just matters related to sports betting and online gaming.