NSX Group, the parent company of Betnacional, is currently facing scrutiny in Brazil for alleged tax evasion, currency evasion, and money laundering. The Federal Revenue Service, alongside the Federal Public Prosecutor's Office (MPF), initiated Operation Shadow Game on Friday to probe the Flutter-owned company.
As part of the operation, authorities executed six search and seizure warrants across João Pessoa, Recife, and São Paulo. The effort involved 28 officials from the Federal Revenue Service, including tax auditors and analysts; 10 federal prosecutors; MPF police officers; and experts from the Secretariat for Forensics, Research, and Analysis.
Operation Shadow Game aims to uncover alleged financial irregularities involving NSX Group, both before and after the legalization of the betting sector. The group is reported to have processed over BRL5 billion ($964.2 million) in bets in 2025 alone. Notably, Flutter acquired a 56% stake in NSX last year.
The investigation has revealed that the accused may have established a shell company in Curaçao with the intention of creating the illusion that its operations were based abroad. In reality, domestic companies associated with NSX were reportedly responsible for its activities in Brazil.
Evidence suggests the use of payment institutions and structured financial transactions to facilitate the movement of money between Brazil and international locations, with a portion returning as payments for services. Tax authorities suspect this could be a means to legitimize previously transferred funds.
Additionally, inquiries have pointed towards the potential use of shell accounts at fintech firms to obscure the tracking of fund flows and to conceal the true beneficiaries.
Despite NSX obtaining approval to operate in the sector in 2025, findings indicate that operations likely commenced prior to this authorization without proper tax payments.
Investigators are also looking into whether the funds for the licensing fee derived from pre-regulation activities. Some structures used for tax evasion may have been reconfigured to avoid detection.
Among other aspects of Operation Shadow Game is the investigation into the reporting of allegedly bogus expenses to tax authorities, which could result in improper tax reductions from 2025 onwards.
This operation marks the second significant initiative by the Federal Revenue Service and MPF aimed at addressing tax and financial discrepancies within the online betting industry. Earlier, on August 13, Operation Arena executed 17 search and seizure warrants in multiple states, targeting Pixbet and focusing on asset seizures totaling BRL1 billion.
The ongoing joint effort by law enforcement and tax authorities seeks to combat tax evasion, capital flight, and money laundering within this rapidly expanding economic sector. In conjunction with the executed measures, the Federal Revenue Service has launched 11 tax audit cases to further investigate identified irregularities, with estimated recoveries of about BRL300 million expected for the public treasury.
As the investigation progresses, authorities will scrutinize financial inflows into the company, aiming to assess the origins of the funds, identify unreported income, and uncover the beneficiaries of the questioned transactions. No arrest warrants have been issued for NSX executives in relation to Operation Shadow Game.
In response to the investigation, NSX Group publicly acknowledged the inquiry, stating that it received a request from the Federal Revenue Service on Friday morning. The company's legal team has yet to access the investigation files, limiting their ability to comment on its specifics at this time.
NSX affirmed its commitment to cooperating fully with relevant authorities and has already provided the requested documents. The company emphasized that it operates in compliance with applicable laws and maintains strong governance and internal controls, in alignment with Flutter Entertainment's international standards. NSX also expressed respect for due process and stated it would continue to provide clarifications through proper channels.
