Brazil Regulates Recovery of Funds Linked to Illegal Betting
Brazil.- 8 September 2026 | www.zonadeazar.com Brazil’s Ministry of Justice and Public Security has regulated an administrative procedure that could allow authorities to recover more than R$1 billion in blocked funds linked to illegal fixed-odds betting operators.
Ordinance No. 1,287/2026 establishes the internal process that cases must follow before potential court action seeking the forfeiture of those funds to the Federal Government.
More Than R$1 Billion Under Review
The potential amount involved exceeds R$1 billion.
The funds have been blocked because of their alleged connection to activities carried out by unregulated betting operators.
The new rules do not automatically transfer the money to the State but create the administrative process required before judicial forfeiture can be sought.
Funds to Support Public Security
Any money ultimately forfeited to the Federal Government following a court decision will be allocated to the National Public Security Fund.
The objective is to transform resources linked to illegal activity into funding for public-security policies.
The money could support investment in infrastructure, technology and operational capacity.
Senasp to Lead Process
The National Public Security Secretariat will be responsible for conducting the procedure.
Day-to-day management will sit with the Directorate for Management of the National Public Security Fund.
Its responsibilities will include:
- Receiving documentation.
- Reviewing evidence.
- Opening administrative proceedings.
- Preparing case files.
- Issuing first-instance administrative decisions.
Information From Finance Ministry
Documentation will be forwarded by the Secretariat of Prizes and Betting within Brazil’s Ministry of Finance.
This structure connects the authority supervising the betting market with the Ministry of Justice.
Inter-agency cooperation will therefore be central to documenting the origin of blocked funds.
Procedural Review Commission
Once proceedings are opened, a Procedural Review Commission will be formed.
The commission must include at least three public officials.
Its role will be to assess documents and evidence and prepare a final report on each case.
Right of Defence
The ordinance guarantees affected parties the right to defend themselves.
Once notified, they will have 15 days to:
- Submit a defence.
- Provide documents.
- Request evidence.
- Identify witnesses.
The framework is designed to guarantee due process before an administrative decision is reached.
Administrative Appeal
First-instance decisions can also be appealed.
Affected parties will have 10 days to submit an administrative appeal.
The appeal will be considered by the Minister of Justice and Public Security.
Administrative Decision Does Not Automatically Forfeit Funds
The ordinance expressly states that an administrative finding in favour of forfeiture does not automatically transfer the money to the Federal Government.
Final incorporation of the funds requires a court order.
This separates the administrative investigation from the judicial stage that determines whether the money can legally be forfeited.
AGU Involvement
Once the administrative process has concluded, cases in which authorities maintain that forfeiture is appropriate will be referred to the Advocacia-Geral da União.
The AGU will assess:
- Legal grounds.
- Available documentation.
- Litigation strategy.
- Appropriate judicial action.
It may then seek forfeiture before the courts.
Statements
National Public Security Secretary Chico Lucas said the new framework creates a route for money linked to illegal activities to be converted into investment in public security.
He said the potential amount of more than R$1 billion could strengthen the National Public Security Fund and increase investment capacity across Brazilian states and the Federal District, provided every administrative and judicial stage is completed.
Camila Pintarelli, Director of Management of the National Public Security Fund, said the ordinance provides legal certainty, transparency and a formal pathway for removing these funds from illegal activity and returning them to society through prevention and protection policies.
Potential Transfers to States
The rules establish that, where possible, priority should be given to transferring the resources to states and the Federal District through mandatory fund-to-fund transfers.
The National Public Security Secretariat will propose how the resources should be used within programmes financed by the Fund.
Any spending must comply with applicable budgetary and financial legislation.
Monitoring the Funds
The Directorate for Management of the National Public Security Fund will monitor each stage.
Tracking will include:
- Amounts initially blocked.
- Funds submitted for judicial consideration.
- Amounts ultimately forfeited to the Federal Government.
- Final allocation of the money.
Management reports and performance indicators will also be produced.
Evidence of Other Offences
The ordinance also requires authorities to report signs of other potential offences discovered during case reviews.
Where evidence points to possible criminal offences, information will be forwarded to prosecutors and police authorities.
Potential Tax Violations
Where proceedings reveal indications involving tax liabilities or fiscal offences, information will be sent to:
- Receita Federal.
- Procuradoria-Geral da Fazenda Nacional.
The process may therefore identify issues extending beyond betting-specific violations.
Industry Context
Brazil has been strengthening enforcement against unlicensed operators since the launch of its regulated betting market.
Website blocking, payment restrictions and financial supervision are part of a broader strategy aimed at reducing illegal-market activity.
The new framework adds an asset-recovery element by allowing authorities to pursue judicial forfeiture of funds linked to illegal betting operations.
Next Steps or Impact
Cases will now begin following the administrative procedure established by the Ministry of Justice.
After review, defence and appeal stages, matters in which authorities maintain that forfeiture is appropriate will be referred to the Advocacia-Geral da União.
The courts will make the final decision.
If the funds are ultimately forfeited, the amount could exceed R$1 billion and will be directed to the National Public Security Fund, potentially supporting programmes across states and the Federal District.
Editó: @fonta
