Brazil:Unexpected setback for the bingo bill in the Chamber of Representatives

The main argument against the legalization is the impossibility to supervize the sector effectively, and the opening to money laundering and tax evasion maneuvres. Right now, here are no defined deadlines for the votation of the project.

Despite the position of the different representatives of the federal government that was presented yesterday in the Chamber of Representatives, legislator Cándido Vaccarezza (PT-SP), one of the main representatives of the government in the Chamber, commented that “there are different positions” to legalize bingos in the federal government.

"The government will not interfere: there won’t be positions against and in favour of bingo. The statement will be released at the moment of the votation,” said the chief of the bloc, which favours the legislation of the bingo halls in Brazil. According to the president of the Chamber of Representatives, Michel Temer (PMDB-SP), there is no date fixed to vote on the bill, in force since 2003.

In the public audience, that lasted four hours, it was left clear that the neither the Federal Treasury nor the COAF want to be responsible for the bingo supervision.

The president of the Council of Control of Financial Activities (COAF), Antônio Gustavo Rodrigues, said that the mechanisms to mitigate the risks of gambling venues that are stated on the current proposal are inadequate.  The bill establishes that the 1,500 bingo halls will contribute with us$ 20,000 monthly, which would bring us$ 360 million a year for their own supervision. It also analyzed the the creation of a specific entity, responsible of regulating games. "It would be important for this industry, regardless of the bingo approval, an entity with capacity to perform an efficient control,” said COAF president.

"The Service of Income Tax was recently submitted to a restructuring and monopolized many skills related to the Braxilian tax administration, and, within their knowledge and experience, it would be incapable of covering more of this activity,” assured María Priscila Santana, from the Ministry of Economy.

The attorney of the Republic, Leonardo Cardoso de Freitas, for example, affirmed that the National Association of Attorneys of the Republic (ANPR) is against bingo legalization, because his activity would facilitate crimes such as money laundering and tax evasion.

Freitas also assures that the control system planned in the bill that is being analyzed in the Chamber should not be implemented. “We are skeptical with regards to the capacity of the Federal Treasury and the Council of Control of Financial Activities in the compliance of an effective supervision of this type of activities”. The strongest critics to the project was the one of the National Secretary of Justice, Romeu Tuma Junior. "We will open the gates to money laundering and organized crime,” he said.

According to Tuma Junior, the approval of the project could hinder the obtaining from Brazil of a permanent place in the Security Council of the United Nations (UN). "If the text is approved, we are not complying with the UN resolution, with regards to the mechanisms to combat money laundering,” he said.

Caixa Económica Federal does not want to control this sector either. The manager of municipal registers and the planning of the National Administration of Physical Channels and Partners from Caixa, Admilson Esashika, affirmed that the entity does not want to be responsible for the supervisión of bingo games, videobingo and slots. “This type of activities are very different from the lotteries, which Caixa operates directly,” he assured.

Esashika also affirmed that the values allocated to the entities of control for the proposal in analysis in the chamber are insufficient. “There are no chances to perform an effective control with these resources,” he commented.

Besides, bingo representatives defended the proposal.They said that legislation will create around 100,000 employments in the 1,500 gambling venues. According to the president of the Brazilian Bingo Association (Abrabin), Olavo Sales da Silveira, the income expectation exceeds us$ 27 billion gross annually. "We can say that around 7 billion a year will be transferred to the public coffers,” he said.