In Brazil, the head of Binance was suspected of fraud

CFTC Files Suit Against Binance and Changpeng Zhao
CFTC Files Suit Against Binance and Changpeng Zhao

A committee of the Brazilian Chamber of Deputies recommended bringing charges against Binance CEO Changpeng Zhao and three top managers of the local division of the crypto exchange. Bloomberg reports this.

The parliamentary structure is investigating the activities of financial pyramids in the country and can only put forward proposals. The decision on actual enforcement actions will be made by the police, the agency noted.

The committee filed claims against Zhao, Daniel Mangabeiro, Guilherme Haddad Nazar and Thiago Carvalho for financial fraud, illegal securities offerings and operating an unregistered exchange.

In a report accompanying the Committee’s recommendation, MP Ricardo Silva noted that Binance is “surrounded by suspicion” in Brazil.

The company said it has made “great efforts” to actively collaborate.

“The exchange categorically rejects any attempt to target Binance or expose its users and employees to allegations of improper practices without any evidence amid competitive disputes, given the platform’s leading position in Brazil and the world,” the Binance spokesperson added.

The committee, which includes 28 members of Congress, also recommended that prosecutors review the exchange’s local branch and Binance Capital Management division for tax compliance.

MPs have proposed that the Securities Commission (CVM) investigate the platform’s sales of derivatives after receiving the ban.

In April, media reported that law enforcement officers, at the request of the department, were studying possible violations by Binance.

Journalists noted that, against the backdrop of legal uncertainty around the exchange, the takeover deal for regulated securities broker Sim;paul Investimentos has not yet been closed. The parties signed the agreement in March 2022, but supervisory authorities have not yet given approval.

Let us recall that the Committee’s study of Binance’s connections with financial pyramids in Brazil became known in June.

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