Binance is being investigated in Brazil by the Prosecutor’s Office and the Federal Police, according to a note from the local newspaper, Valor Econômico. The cryptocurrency exchange reportedly helped its clients circumvent a stop order for investments in cryptocurrency derivatives.
According to the newspaper, The Securities and Exchange Commission informed the Attorney General of the State of São Paulo that Binance may have continued to offer cryptocurrency derivatives to its clients after the Commission had issued an order to suspend those offers in 2020. Futures contracts are considered securities under Brazilian law, regardless of the nature of the underlying assets.
The Commission presented to the police screenshots taken in August 2021 that showed instructions for Brazilian users to change their language settings to access the Binance futures section. The Commission also stated that there was abundant content in Portuguese with no restriction notices for users in Brazil.
Public information seen by Valor Econômico showed that Binance responded to the allegations in February by submitting a proposed compromise agreement. No decision has been made on that proposal.
JUST IN Binance under investigation by Federal Police in Brazil for “alleged financial crimes” – Globo pic.twitter.com/EsdDKMpB86
— Radar (@RadarHits) April 20, 2023
Binance told the newspaper in a statement that “reiterates that it does not offer derivatives in Brazil, that it operates in accordance with the local regulatory scenario and maintains a permanent dialogue with the authorities for the development of the cryptocurrency and blockchain segment in Brazil and in the world.”
Binance has faced accusations of this kind before. He operated in the Canadian province of Ontario for months after notifying the Ontario Securities and Exchange Commission that it would cease its activities. Apparently, Binance acknowledged in February that he was working with US regulators to resolve compliance issues. In March, Binance was sued by the United States Commodity Futures Trading Commission for alleged violations in their operations.
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