IBJR counters banking criticism and calls for tighter financial controls

The Brazilian Institute of Responsible Gaming (IBJR) has defended the country's regulated betting market following criticism from the Brazilian Federation of Banks (Febraban).

Febraban's President, Isaac Sidney, called the legalization of betting operations a "mistake" and a "moral setback."

The remarks were made during Febraban's Congress on Anti-Money Laundering and Counter-Terrorist Financing.

Sidney argued that Brazil's decision to legalize online betting introduced new risks into the financial system and led to a "proliferation" of vulnerable institutions.

"The role of banks is to maintain absolute vigilance and total intolerance toward risky betting operations," he said, mentioning recent investigations that exposed financial firms linked to criminal activity and money laundering.

In response, IBJR President André Gelfi said regulation, rather than prohibition, is essential to fighting the underground market.

"This market has always existed. Regulation brought visibility to the problems. Thanks to betting's legal framework, we're now discussing improvements to internal control systems," he said.

Gelfi warned that over-restricting licensed operators could push players back to unregulated offshore sites.

"When you suffocate the regulated market, the alternative for bettors is to type '.com' instead of '.bet.br'. The real competition is the illegal market, just one click away."

He called for deeper cooperation among the National Financial Activities Control Council, the Central Bank and the Secretary of Prizes and Betting, Brazil's regulator, to strengthen financial oversight.

"The bettor can't deposit on a clandestine site without passing through the financial system, most transactions happen via Pix," Gelfi noted, mentioning Pix, Brazil's automatic payment system.

The exchange reflects growing tension between Brazil's financial institutions and its newly regulated betting sector.