Brazil's system for distributing mandatory betting-derived funding to sport is increasingly dependent on artificial intelligence as authorities struggle with inconsistent data submitted by licensed operators.
Billions of reais set for sport under Brazil's betting legislation are calculated based on information provided by betting companies themselves.
These funds stem from compulsory allocations tied to wagers placed on sporting competitions. However, the absence of a standardized reporting framework has complicated the calculation process and limited effective oversight.
At the centre of the issue is how operators are identified and categorized. Operators submit reports using different naming conventions, formats and data structures when detailing wagers placed across leagues and tournaments.
As a result, the same tournament may appear under multiple labels, making automated reconciliation difficult and increasing the risk of distorted allocations.
To address the problem, the National Office for the Distribution of Resources (ENDR), established by the Ministry of Finance to manage statutory betting transfers, has adopted artificial intelligence tools to detect inconsistencies and errors in the data received.
During the first half of the year alone, the office processed more than two billion individual betting records.
Under the current model, operators make a single consolidated monthly payment to the ENDR.
The office then distributes funds to federations, confederations and other eligible sports bodies based on betting activity linked to their competitions, following criteria set out in law.
While the centralization of payments has simplified cash flow and reduced administrative friction, it has also concentrated risk.
The use of AI has helped close gaps in the short term but officials acknowledge that lasting improvements will require clearer reporting standards and stronger regulatory alignment as Brazil's betting market continues to mature.
Industry sources note that the accuracy of distributions now depends almost entirely on the quality of operator data, with limited independent verification mechanisms in place.
Brazil has approved a gradual increase in betting taxation as part of broader efforts to strengthen oversight of the regulated market
