Jun 23, 2023 12:25
Binance’s troubles with
public authorities may compound in the coming days as
Alfredo Gaspar, a Brazilian lawmaker, has requested that the country’s lower
parliamentary house probe the cryptocurrency exchange over alleged connections
to pyramid schemes in the country. Gaspar asked that
Guilherme Nazar, Binance’s Country Manager in Brazil, be summoned before the
chamber to testify as a witness in a Commission of Inquiry (CPI) investigation.
Lawmaker Justifies Probing Binance
According to Gaspar,
Binance operates in Brazil through a representative firm, B Fintech Serviços de
Tecnologia LTDA. Defending the request to summon Nazar, the lawmaker cited the
media report of a pyramid scheme, Ever Operations and Investment, whose funds
were held in a Binance account and blocked following a court order.
The lawmaker
also mentioned another media report involving
Brainscompany,
a crypto investment management company, which blamed Binance for the delay in paying its customers in December. The
media report compared the Brainscompany’s business model to that of Rental Coin,
a reportedly fraudulent crypto scheme whose Founder was
arrested last year.
Providing further
justification for the request for the summon, Gaspar pointed
to the ongoing lawsuit of the US Securities and Exchange Commission against Binance
for allegedly mishandling client funds, among other allegations.
He added that Binance is also facing or previously
suffered regulatory crackdowns in Brazil, Japan, China, Germany and the United
Kingdom.
Brazil’s
SEC Investigates Binance
According to Brazilian financial
publication, InfoMoney, the Securities and Exchange Commission of Brazil in
March reopened its 2022 investigation into B Fintech for allegedly offering
derivatives contracts to users in the country without authorization. The
securities regulator told the publication it had “new facts” for the case.
However, Binance in
response denied the allegation, saying it does not offer derivatives in Brazil.
Nonetheless, the lawmaker listed the report as another reason for the lower parliamentary chamber to approve the summon.
“Therefore, we can
deduce that Binance is entirely intertwined with the motivation of this CPI and
it is essential to understand its performance in the country, its relationship
with B Fintech (its official representative), as well as its connection with
companies that respond in court for harming Brazilian consumers,” Gaspar
explained in Portuguese, as translated into English.
According to Brazilian
news outlet, Portal do Bitcoin, other members of the CPI will vote on Gaspar’s
request to summon Binance’s head in Brazil at their next session likely to hold
on June 27, 2023.
Meanwhile, Binance is
reportedly being investigated by public prosecutors in Paris over the ‘illegal’ provision
of crypto services before it was licensed in May last year, Finance Magnates recently reported. The crypto exchange is also being
reportedly probed for ‘acts of aggravated money laundering’ and has been under
investigation since February 2022.
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This article was written by Solomon Oladipupo at www.financemagnates.com.
World Crypto Global
