Affiliate Leaders takes a look at whether a recent testimony delivered to Brazil’s Parliamentary Inquiry Commission on Betting could mean ‘game over’ for influencers.
As Brazil culminates its long, arduous journey to regulation – operators, suppliers and affiliates are all scrambling to get in on the action.
But in the shadows of gambling reform and future growth opportunities, affiliates have found themselves at the centre of more scrutiny – with one such developing story potentially spelling the beginning of the end for gambling influencers in Brazil.
Brazil isn’t the first market to cast doubt on the role of influencers and affiliates, nor will it be the last. But last week, Lucimério Barros Campos, the police chief of Brazil’s Alagoas state, delivered a damning testimony to the Parliamentary Inquiry Commission (CPI) on betting as he told politicians that social media influencers are misleading and scamming gamblers.
Stemming from an investigation dubbed Operation Game Over, the police chief lifted the lid on some dubious activity from online influencers who had been luring players towards the black market.
Although the police snoop sounds like something from a blockbuster movie, it’s not filled with as much glitz and glam as Hollywood would hope. However, it did raise a question – it’s no longer a case of whether this damning case will change the affiliate marketing model. But rather, how drastically will it change? And what will be the knock-on effect for the wider industry?
Brand building
In a time where a well-lit, 30-second Instagram video can wield more influence than a political ad, it’s perhaps no surprise that Brazil’s burgeoning gambling black market has turned to social media influencers to push their wares.
But the scale and sophistication of the scam revealed by Barros Campos isn’t something that can be just brushed under the carpet.
Since the Brazilian market officially formalised its regulations on 1 January, Barros Campos’ investigation estimates that BRL15 million had been wagered via illegal bets in Alagoas alone – the full extent as to how much had been wagered via unlicensed operators across Brazil as a whole was not disclosed.
The police chief said: “In order to play, the gambler needs to download an app. That app provides a famous demo account for influencers.The [influencer] would post the link for people to click and bet, but they also received another [fake] link where they could log in and record the screen showing how they made the big win. It was all a scam.”
Affiliates benefit from every new bettor that they direct to a site and convert. But the damage caused by affiliates directing players to unlicensed sites ripples far beyond their follower counts.
Barros Campos made clear that many of these promotions are not just deceptive, but potentially criminal: encouraging money laundering, manipulating vulnerable consumers and draining cash from the local economy.
While it may only be a small few, it’s those negative associations that can usher in long-term reputational damage. The gambling industry certainly doesn’t need that headache, especially not in a newly-regulated market.
Barros Campos certainly didn’t mince his words when speaking to the CPI: “If there is no proper regulation of this type of activity, we are talking about predatory activity here, which poses a very significant risk to the health of Brazilians.”
It’s easy to think of this story in isolation, simply limited to the state of Alagoas, but the reality is much greater. This is a story of national consequence and one that can create a roadblock for a market that’s just finding its feet.
The writing is now on the wall for gambling affiliates and influencers. Until now, the gambling affiliate model has enjoyed relative freedom from the regulatory authorities. For legal operators, affiliates are a powerful tool for building a brand, enabling sportsbooks and casinos to drive acquisition through content marketing, SEO and influencer partnerships.
But the very same mechanisms have been exploited by black market operators, using the credibility and reach of digital personalities to build trust where none is deserved. Operation Game Over means that … well, it might be game over for influencers.
The CPI, backed by voices like Senator Damares Alves, who decried the black market as “disgusting”, now seems hell-bent on tightening its grip.
Meanwhile Federal deputy Kim Kataguiri has introduced a bill that would criminalise the promotion of illegal gambling platforms, with prison sentences of up to eight years for affiliates and influencers who target children or vulnerable populations.
It’s a sharp pivot toward accountability, and more importantly, a warning shot for a section of the industry that has previously operated with relative freedom.
A tightened grip
Of course, the broader affiliate industry will be watching closely to see how Barros Campos’ testimony will shape Brazil’s gambling market going forward.
Affiliates are likely to face increased scrutiny about which brands they promote, and how. But it’s clear – due diligence will no longer be optional. Promoting an unlicensed operator could carry a real legal risk, not just a reputational headache.
For some, this will be a painful shift that will add a mountain more compliance boxes to tick. The unregulated market has been a lucrative opportunity in the past; but the cost of maintaining the status quo and continuing to promote unlicensed operators is rising.
The Brazilian regulator now finds itself at a crossroads, however. If Brazil can strike the right balance by cracking down on illegal actors while still fostering a clear, regulated path for affiliates, then it could be on to a winner. The market will likely emerge stronger, safer and more sustainable.
The Alagoas investigation has pulled back the curtain on a darker side of digital gambling promotion, but it also offers a chance to course-correct. The end may be near for gambling influencers who built their success on deception. But for those willing to adapt, this might just be the beginning of a lucrative opportunity.
