NSX Group, the owner of Betnacional, is currently facing a tax evasion investigation in Brazil, which also includes allegations of currency evasion and money laundering. This probe, conducted by the Federal Revenue Service and the Federal Public Prosecutor's Office (MPF), was initiated through Operation Shadow Game, launched on Friday with a focus on scrutinizing the group, which is owned by Flutter.
The operation rolled out with six search and seizure warrants executed across João Pessoa, Recife, and São Paulo. It mobilized 28 officials from the Federal Revenue Service, comprising tax auditors and analysts, alongside 10 federal prosecutors, MPF police officers, and forensic experts.
Operation Shadow Game is delving into NSX Group's financial practices, uncovering purported tax and financial irregularities that predate and follow the regulation of the betting sector. Reports suggest that the group managed betting services with transactions exceeding BRL5 billion ($964.2 million) in 2025. Flutter completed its acquisition of a 56% stake in NSX last year.
The investigation reveals allegations that the subjects created a shell company in Curaçao, ostensibly to give the impression that their operations were international before regulation was put into place. However, findings indicate that Brazilian companies tied to the group were managing operations domestically.
Evidence indicates the use of payment institutions and structured transactions to facilitate the movement of funds between Brazil and overseas. It's suspected that some of these funds were later sent back to Brazil disguised as payments for services. Tax authorities believe this was a strategy to legitimize the repatriation of money that had previously been transferred outside the country.
Furthermore, investigators suspect that shell accounts at fintech firms were employed to obscure the flow of funds and hide the ultimate beneficiaries. While NSX Group secured authorization to operate in the sector in 2025, there are signs that it had already been conducting business in Brazil prior to that date without proper authorization or tax payments.
Investigators aim to trace the origin of the funds used for the licensing fee, assessing whether they stemmed from pre-regulation activities. Evidence suggests that existing structures were manipulated to perpetuate tax evasion.
The investigation also includes scrutiny over the reporting of fictitious expenses to tax authorities, with potential implications for tax liabilities starting from 2025.
This operation marks the second significant initiative by the Federal Revenue Service and MPF targeting financial misconduct in the online betting sector. On August 13, Operation Arena executed 17 search and seizure warrants across five states, resulting in the seizure of assets and funds totaling BRL1 billion, with a focus on operator Pixbet.
Authorities aim to combat tax evasion, illicit capital flight, and money laundering as these activities become more prevalent in the rapidly growing betting industry. Alongside court-ordered actions, the Federal Revenue Service has launched 11 tax audit proceedings to further examine identified irregularities, with a potential recovery estimate of approximately BRL300 million for the treasury.
As the investigation progresses, authorities will scrutinize both domestic and international financial inflows to NSX Group, seeking to verify the origins of funds, identify unreported revenue, and clarify transaction beneficiaries. To date, no arrest warrants have been issued against NSX executives in connection with Operation Shadow Game.
In response to the investigation, NSX Group publicly acknowledged the inquiry, stating, "NSX Brasil confirms that it received, this Friday morning (28), at its office in Recife, a request from the Federal Revenue Service, within the scope of an investigation conducted by the Federal Public Prosecutor’s Office (MPF)." They added, "The company’s lawyers have not yet had access to the investigation files, and for this reason, it is not possible to comment on its content at this time."
NSX Group emphasized its commitment to cooperating fully with authorities, stating, "We will remain available to provide all necessary clarifications, having already submitted the requested documents and information." They further assured that throughout their operations in Brazil, they conduct business in compliance with applicable laws and maintain governance structures that align with international standards set by Flutter Entertainment, which is publicly traded on the New York Stock Exchange and operates in over 100 countries. NSX reiterated respect for due process and commitment to providing necessary clarifications through institutional channels.
