Brazil's Lula bans online gambling. Describes it as "cancer"

[rdluffy]

...
If Lula was keen in banning it, then he should give a time for the transition purpose like what EPL did to its clubs. I also believe the ban won't stop people from accessing offshore, and there may be more people doing it due to the Lula's immediate ban.

I’m going to mention something really interesting here
This very famous news site in Brazil ran a news identifying nearly 700 “illegal” betting sites that were created right after the ban 
The article was updated yesterday, and we’re already seeing more reports that even more sites are being created for people to bet on

It simply had the opposite effect of what they imagined, and the demand is still there

Here’s the source of the article
https://g1.globo.com/jornal-nacional/noticia/2026/09/29/quase-700-bets-ilegais-foram-criadas-depois-da-proibicao-anunciada-pelo-governo-aponta-levantamento.ghtml
it’s in Brazilian Portuguese, but if you’re interested, you can easily translate it

[danadc]

The most bizarre part of this whole story is that President Lula himself signed the law that regulated casinos and betting platforms. Anyone wanting to operate in the country even had to pay a $30 million license fee. So everyone paid up and was operating legally, and now betting companies are everywhere in Brazil, sponsoring teams, TV networks, and up until now everything was above board. Then the president decides to ban it all, and where does that leave the companies? What about all that invested money? On top of that, the government is suing the betting companies for addiction damages, asking for $1 billion in compensation. What's happening in Brazil is absolute madness.

He doesn't care, because Lula used to get along well with Chávez and Maduro. He's had that misguided inclination towards socialism/communism where he doesn't care about stealing from investors and people. It must be because he's involved in a business where gambling isn't convenient for him. I don't know how governments like that stay in power; what they do is ruin everything and set progress back. That's what happened in my country many years ago.

[icebar]

If the ban goes into effect, the biggest winners would be dark market crypto casinos, which don't care too much about compliance with Brazilian law. I think crypto in general will see increased adoption in Brazil.

Such a sudden decision by the government never seems logical. If the government had reviewed the decision well, I would have definitely evaluated it. But such a decision of theirs will not be able to stop the country's gamblers from gambling, but rather it will cause financial losses to the legal gambling platforms. The decision taken by the Brazilian government has already started to have a major negative impact on the football clubs of Brazil. I think that no matter how hard the government tries, they will not be able to control the situation because the government will not be able to provide such a huge financial support. It is not logical to close them without returning the money they have taken from 85 companies.

If the government provides financial support to the clubs through loans, it will never enough for these clubs and I think the situation of the clubs may become dire in the coming days. I don't know the Brazil government has taken such a decision to gain any political advantage, but such a decision without prior notice is never acceptable. Due to such a decision by the government policy makers, the country will lose a huge amount of revenue, and the common people of their country will now try to place their bets on the black market, which will definitely have a negative impact on their country's economy.

[Alphakilo]

The most bizarre part of this whole story is that President Lula himself signed the law that regulated casinos and betting platforms. Anyone wanting to operate in the country even had to pay a $30 million license fee. So everyone paid up and was operating legally, and now betting companies are everywhere in Brazil, sponsoring teams, TV networks, and up until now everything was above board. Then the president decides to ban it all, and where does that leave the companies? What about all that invested money? On top of that, the government is suing the betting companies for addiction damages, asking for $1 billion in compensation. What's happening in Brazil is absolute madness.

He doesn't care, because Lula used to get along well with Chávez and Maduro. He's had that misguided inclination towards socialism/communism where he doesn't care about stealing from investors and people. It must be because he's involved in a business where gambling isn't convenient for him. I don't know how governments like that stay in power; what they do is ruin everything and set progress back. That's what happened in my country many years ago.

I see reason with you because a news like this is a real setback mostly for Brazilian football that will be faced with a forced liquidity problem following loss of sponsorship and with more borrowing with interest that may crumble the aspirations of some of the league football clubs in the country.
However, before this ban will be enforced, Congress must have to vote to accept it or reject it and the outcome of this may be the reason for increase in dark market for crypto currency betting or not.

[Dogedegen]

If the ban goes into effect, the biggest winners would be dark market crypto casinos, which don't care too much about compliance with Brazilian law. I think crypto in general will see increased adoption in Brazil.

Politicians like this are horrible, they do not know what they are doing with their ideas and actions. They create much more harm than good. If they make this ban, gambling will continue, industry and economy will be damaged and people will be left without consumer protections. So where is the benefit from this action? It makes everything worse, we know by data and studies that this kind of move never stops gambling. It makes it more dangerous for everyone and gambling continues, sometimes even more than it was before. I hope that this does not come in effect, but they seem to want to drive good business away.

I agree, an outright ban feels more like a band-aid than a cure. Better to regulate it properly and use some of that revenue for addiction support than push everyone toward the black market.

I am not sure if it can be considered band-aid even because it does not do anything at all. We have seen how banning things that people want to do does not make them stop it, sometimes there is an even increase in that activity. So for this kind of thing regulations are always the better answer.

[stompix]

I’m going to mention something really interesting here
This very famous news site in Brazil ran a news identifying nearly 700 “illegal” betting sites that were created right after the ban 
The article was updated yesterday, and we’re already seeing more reports that even more sites are being created for people to bet on

It simply had the opposite effect of what they imagined, and the demand is still there

They can still block them all if they are truly committed to that!
Oh, but they would use VPNs, just block the entry points of the most commonly used VPNs.

If they are indeed willing to go all the way, they could cut a lot of usage for real, not to mention some of those that try new casinos will get scammed and learn pretty fast what an offshore casino with no license means. Of course, it will not stop all the people from gambling but it will reduce it, not eveyone is willing to go through all those steps to avoid a barrier only to get scammed!

I’d say the problem here is that the current president is running for re-election and is losing in the polls
Out of desperation, he’s trying to take populist measures to try to win the election again
What he’s doing makes no sense

Pure curiosity, has Lula any kids in politics? One who could run for president next time when he's in prison?
I can't think of anything funnier other than Melania running against Hillary!
 

[sunsilk]

The worst of all is that this would not solve the problem, it will only move people to the black market and to use VPNs.

This is true, gamblers who understand how they can still access online casinos will simply do these things and will continue to gamble.

While that stops the access from the normal way of browsing for the users who don't know these tricks.

And is it true that one cause of this policy is also about reducing or stopping these people from having more debts? Because online gambling caused them to have more debts.

[uneng]

I’d say the problem here is that the current president is running for re-election and is losing in the polls
Out of desperation, he’s trying to take populist measures to try to win the election again
What he’s doing makes no sense

Pure curiosity, has Lula any kids in politics? One who could run for president next time when he's in prison?
I can't think of anything funnier other than Melania running against Hillary!

Curiously, neither of his sons have political careers. But the one who carries his name, Lulinha (Little Lula), is being investigated once again in a corruption scandal involving a scheme with money from public pension fund for elders.

None of his kids could run for presidency after him and his political legacy must be desired by another leftwing politicians. There isn't a clear figure to replace him, though.

Anyway, I don't believe the measure of banning bets will go further. It's a desperate populist measure which most people in the country agrees with, so he is literally "betting" it's going to favour him on the upcoming election. But as soon as the election is over, bets will be reinserted in Brazil once again.

There are just too many people profiting from regulations towards this industry to let it slip away like that, including politicians who Lula need as allies while president.

[Hispo]

I’d say the problem here is that the current president is running for re-election and is losing in the polls
Out of desperation, he’s trying to take populist measures to try to win the election again
What he’s doing makes no sense

That makes sense. I mean, apparently it doesn't make sense but now I can understand why he is doing it. It is, unfortunately, not at all unusual for politicians to resort to desperate, populist measures in a bid to win an election.

In any serious country the president and the state in general would be forced to respect those licenses which were issued for 30 million so gambling could not be outlawed for several years. 

That’s another matter. In a proper country with a separation of powers, the courts would overturn this measure, but I don’t know how things will pan out in Brazil.

Sadly, there seems to be too little separation of power here in Latin America.
In the most of our democracies, it seems the president of the country concentrates much of the political and administrative power in the country.
And I agree with you, in a functioning democracy with actual separation of power. Some federal judge would have over-turned the decision of Lula.

[Floxynice]

Ahead of the impending Brazilian presidential election, the current president, Luiz Inacio Lula da Silva, decided to unexpectedly crack down on online gambling.

A few related press hits.
https://www.bbc.co.uk/news/articles/c914ddj21rzlo
https://www.independent.co.uk/news/business/luiz-inacio-lula-da-silva-ladbrokes-new-york-betfair-paddy-power-b3057655.html
https://www.racingpost.com/news/industry/the-black-market-will-be-by-far-the-biggest-winner-of-brazils-online-gambling-ban-leading-betting-industry-analyst-warns-aHXMd7P84SYj/

He also does not feel obliged to return the gambling licence fees that around 85 companies paid in order to be allowed to operate in Brazil. Those licences, most of which are said to be purchased within the last 2 years, are worth approximately half a billion USD.
I read that that move could also potentially bankrupt some of the biggest football clubs in the country that are reliant on sponsor money from gambling businesses. I hear that he offered them loans to mitigate liquidity risks, but that's just not the same.

Are there any Brazilians on this forum able to provide more insights on what is going on in Brazil?

If the ban goes into effect, the biggest winners would be dark market crypto casinos, which don't care too much about compliance with Brazilian law. I think crypto in general will see increased adoption in Brazil.

Sometimes I wonder if some leaders think before making any decision. In few years to come, let's see how the headline changes from "Brazil's Lula bans online gambling. Describes it as "cancer", to "The Brazil president seeks to crackdown on illegal gambling pandemic the country". If only they understand that they cannot suddenly stop people that have previously been exposed to gambling from gambling because these people will always device another means to gamble. When this happens, the government will realise that it lost revenue from the decisions they took

[Julien_Olynpic]

Silly bans are always bad and always lose out to sensible regulation. Brazil is a large and wealthy country that can easily afford sensible gambling regulation. But politicians crave populist gestures that they believe will help them win elections. On the other hand, as far as I know, Brazil has no experience with a complete ban on gambling. If so, the history of bans and the negative consequences of these decisions could serve as a valuable lesson for future politicians.

[r_victory]

He only did this to promote himself as a hero during election season. It's a temporary measure that can last a maximum of 90 days. What he did was practically a crime of fraud, because he charged for casino licensing; many football teams here signed 4-5 year sponsorship contracts, and some will lose approximately $200 million. Nothing this government does is thinking about the people, but only about themselves. And they're still using the population's indebtedness as an excuse, as if the price of housing, rent, low wages, unemployment, and high food prices didn't exist. Bunch of hypocrites...

[danherbias07]

He may have a different intention, but this could be going south for many industries.

I agree that it could go badly for a person when he or she becomes addicted to gambling, but if gambling is helping the economy of one country to thrive, why stop it? Or, why not implement a different rule like in Singapore or other countries who doesn't let their countrymen do the gambling, but only tourists.

I think they went too quickly with this decision, if it is ever in effect. Not just the illegal offshore gambling will be happy about it, but I think prediction markets too. Those gamblers will still find a way to gamble, but sadly, the government won't get anything (tax) if they are playing on an illegal online casino.

[Zlantann]

He also does not feel obliged to return the gambling licence fees that around 85 companies paid in order to be allowed to operate in Brazil. Those licences, most of which are said to be purchased within the last 2 years, are worth approximately half a billion USD.

If he fails to compensate these companies for their losses, then they should approach the court. The companies have not just spent a fortune on licenses but on advertising, endorsement deals, and so on. The country should have given these gambling platforms a long time to prepare for this ban.

I read that that move could also potentially bankrupt some of the biggest football clubs in the country that are reliant on sponsor money from gambling businesses. I hear that he offered them loans to mitigate liquidity risks, but that's just not the same.

It should be a grant and not a loan. Loans will have to be repaid, and it is still a financial burden to these sports platforms.

If the ban goes into effect, the biggest winners would be dark market crypto casinos, which don't care too much about compliance with Brazilian law. I think crypto in general will see increased adoption in Brazil.

Politicians will always make decisions to make them win elections without considering the consequences. This ban will take away jobs and resources from Brazil to illegal gambling organizations.

[Africolo]

Was this move totally unexpected?  I thought I had read about it a while ago.  There is certainly no shortage of examples for why gambling is bad, but a lot of people also enjoy it and it is a big moneymaker, so I'm not sure banning it is the direction it is headed as a whole.  It sounds like this is a move that will likely hurt a lot of people with less money flowing around, but will also probably help a few people who can't control their actions.

This type of extreme measures only it used when the country majority of people is affected by gambling and it is causing damage. In here where I live in 2019 they put a nation wide on every form of gambling because all the citizens were affected, young people who were in school were putting a parlay ticket with their pocket sandwich money and it was a nation wide problem. I don't know the situation in Brazil but if it is the same I don't blame Lula at all, it will help most people.

This is extremely bad because it will affect entrepreneurs that has invested a lot in the casino business and those that are yet to get license for their newly opened casinos considering all the money they have invested in it and suddenly the government wants to close it down but in a way the government is just trying to protect the citizens from too much damages and addiction amongst the citizens so I think in a way it's doing the people more good but bad to casinos owners.

No doubt gambling is bad especially when people engage in it and don't control their betting activities nor have a bankroll, it's frustrating when people sell their properties in other to fund their wallets just to gamble. Let's those gambling try to bet with what they can afford to loose and bet within their budget.

[Filicius]

He only did this to promote himself as a hero during election season. It's a temporary measure that can last a maximum of 90 days. What he did was practically a crime of fraud, because he charged for casino licensing; many football teams here signed 4-5 year sponsorship contracts, and some will lose approximately $200 million. Nothing this government does is thinking about the people, but only about themselves. And they're still using the population's indebtedness as an excuse, as if the price of housing, rent, low wages, unemployment, and high food prices didn't exist. Bunch of hypocrites...

Thank you for the insight r_victory, your post is very clarifying, because there is a big difference between being such a temporary measure and being something definitive, which is how most of us were interpreting the news.

Where I live and I think in the entire Europe a measure like this would be unthinkable because it would be taken as an attack on individual freedom, but where that is not the case, I already see that it is used as an electoral weapon.

[hedgeh0g]

This is extremely bad because it will affect entrepreneurs that has invested a lot in the casino business and those that are yet to get license for their newly opened casinos considering all the money they have invested in it and suddenly the government wants to close it down but in a way the government is just trying to protect the citizens from too much damages and addiction amongst the citizens so I think in a way it's doing the people more good but bad to casinos owners.

No doubt gambling is bad especially when people engage in it and don't control their betting activities nor have a bankroll, it's frustrating when people sell their properties in other to fund their wallets just to gamble. Let's those gambling try to bet with what they can afford to loose and bet within their budget.

As a player, I would ideally like to see people play without losing every penny at their disposal including their savings or borrowing money from friends and relatives only to lose that too. Yet, this happens all around us, even though many players keep quiet about it to avoid being labeled as compulsive gamblers. I certainly don’t object to state regulation of the gambling industry, though I realize that striking the perfect balance between strict oversight and the reality of people losing more than they earn is an incredibly difficult challenge. That does not mean, however, that the state shouldn't try.

[rdluffy]

...

They can still block them all if they are truly committed to that!
Oh, but they would use VPNs, just block the entry points of the most commonly used VPNs.

If they are indeed willing to go all the way, they could cut a lot of usage for real, not to mention some of those that try new casinos will get scammed and learn pretty fast what an offshore casino with no license means. Of course, it will not stop all the people from gambling but it will reduce it, not eveyone is willing to go through all those steps to avoid a barrier only to get scammed!

Yes, they can make life very difficult for bettors who decide to use a VPN
When they banned X here for a while, they warned that they would impose a fine of 50,000 reais ($10,000 USD) per day on anyone who used a VPN to access the social network 
All they have to do is do that again

It’s worth noting that they never actually imposed any fines, but just the fact that they announced a fine was enough to scare the majority of the population
They might end up imposing fines on those who circumvent the rule, and I’m sure that alone would already reduce usage

Most people also don’t know how to use cryptos for betting, so with the banking system blocked for casinos, betting volume has likely already dropped by more than 90%, I’m sure of it

Pure curiosity, has Lula any kids in politics? One who could run for president next time when he's in prison?
I can't think of anything funnier other than Melania running against Hillary!

Lula’s son isn’t a politician, but he’s involved in corruption scandals, and more and more details about him are coming to light
In a responsible government, he would already be in jail
Lula is the leading figure on the left, and the left will likely be severely weakened when he leaves politics

[knowngunman]

The worst of all is that this would not solve the problem, it will only move people to the black market and to use VPNs.

I don't know how you people feel about this potential change but to me it's sad to read. The bad side of it is not even the gambling ban itself but how people business is being affected overnight. The operators invest huge amount in this business and they did it with their own (government) approval. It's morally wrong to stop from operation and at the same time hold their money when the licence is yet to be expired.

Sometimes I wonder if these so called representatives have advisers at all because if they do, there is no way they'll be channeling their energy to wrong areas. They are creating another problem thinking they've just solved a problem. Just like you said, people can still gamble using other alternatives and government is at the losing side eventually because no more revenue is coming from gambling and they have increased the number of unemployed people.

[Yorubek]

This government really wants to chase casinos out of the country, but it's an unfair practice which is also sending the wrong message to those outside of the country that could have been willing to do business with them as they won't be certain of their policy, and they don't even intend on giving back part of compensation for what they paid for, and I doubt those casinos have been able to make half of that money they spent.

It's a terrible decision that was probably made to pull votes to his direction, I think it's going to backfire, the international community won't see it as just a door closed to gambling, if you were willing to take their money and then shut down their business then you are not worth working with, it's simple logic.
Worst off, aside from the fact that it will definitely affect local football in the country, illegal casino will definitely still be operating from the shadows and with the legal ones out of the way they are now bound to make more money without half the responsibility that the previously licensed casinos has.

This may be a terrible decision to get more votes in the election, I think Luiz Inacio Lula da Silva, the decision he wants to take will not really free the country from gambling completely. As a result, all licensed casinos will face huge financial losses and foreigner investors will suffer, which will lead to a loss of confidence. By taking this decision, all illegal casinos in Brazil will benefit from this opportunity.

If this decision is implemented, the government must take specific steps to compensation all legal or licensed casinos. When a license is obtained, the government has to pay a lot of money to obtain the license, so when the government decides to close the casino before the specified time, it is very important to keep in mind the loss of the government's casino, from my point of view.