Brazil: Pay4Fun Strengthens Fight Against Illegal Betting

Brazil.- June 17, 2025 www.zonadeazar.com The growing concern over the illegal betting market in Brazil gained prominence following the submission of the final report from the “Bets CPI” in the Federal Senate. In this context, Leonardo Baptista, CEO and co-founder of Pay4Fun—an institution authorized by the Central Bank—highlighted the risks of unlicensed platforms and pointed to the most effective mechanisms in combating such activities.

Warning signs of irregularities in the sector

Pay4Fun, the first regulated payment institution in the sector, has already severed ties with over 600 irregular operators. According to Baptista, the main indicator of illegality is the website domain.

Since January 2025, only “.bet.br” domains are authorized to operate in the country. Platforms with “.com” endings or other variations are not compliant with Brazilian legislation.

Beyond the domain, other red flags include:

  • Use of prohibited payment methods such as credit cards or crypto assets;

  • Lack of identity verification;

  • Weak anti-money laundering systems;

  • Misleading marketing campaigns promising guaranteed profits.

To prevent these platforms from advancing, Pay4Fun adopts strict measures. Baptista stated: “Payment methods are the main pillars of the regulated ecosystem.”

The company requires full documentation, validation of the CPF (Brazilian Individual Taxpayer Registry), and only authorizes transactions with accounts in the name of the holder. This prevents activity from minors or individuals on restrictive lists.

Another decisive factor is financial blocking. Pay4Fun’s CEO said: “Cutting off access to the financial channel is the most effective way to shut down illegal operations.”

Even if websites manage to bypass URL blocks, without access to the payment system, the activity becomes unfeasible. Over 99% of transactions are conducted via Pix, which underscores the importance of this control.

Real-time monitoring by Pay4Fun

Pay4Fun also monitors transactions in real time and applies a strict partner analysis process called KYM (Know Your Merchant). The goal is to ensure that only companies licensed by the Secretariat of Prizes and Betting (SPA) are integrated into operations.

According to Baptista, Brazil could follow the UK model, which invests in integration between financial institutions, operators, and regulators. He believes cooperation between companies and the public sector should be strengthened. Challenges remain, such as SPA’s low inspection capacity and the lack of integration among responsible agencies.

Regarding regulation, the executive warned: “Regulation already exists, but it must be accompanied by faster oversight and effective penalties.” He also advocated for stricter rules against misleading advertising, especially by influencers who link betting to promises of easy profits.

Currently, Pay4Fun works alongside the Central Bank, SPA, and the Financial Activities Control Council (COAF). The company sends alerts about illegal campaigns, suspicious transactions, and irregular platforms, and collaborates with licensed operators by sharing information.

Despite the challenges, Leonardo Baptista sees a promising outlook. He believes Brazil could become an international benchmark in the sector, provided structural advancements are made. Key aspects include the regulation of crypto assets and strengthening the SPA with more autonomy and a specialized technical team.

Finally, the company also invests in consumer education. Baptista stated: “The country may even move forward in the discussion about legalizing physical gaming, such as casinos, consolidating a safe, transparent, and sustainable environment.”

Edited by: @_fonta – www.zonadeazar.com

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