The Brazilian Association of Cryptoeconomics (ABCripto) asked on Tuesday (2) for the Federal Public Ministry (MPF) to file a public civil liability action against Binance, the world's largest brokerage house that has been operating in Brazil since 2019. Banco Central do Brasil (Bacen) and the Brazilian Securities and Exchange Commission (CVM) were also called by the association.
In a note, ABCripto said that the exchange is not complying with the CVM's own decision, which in July 2020 banned the company from advertising any public offering of securities intermediation services.
He also said that the exchange does not integrate the securities distribution system and is not authorized to function as a financial institution or as a payment institution in the country. In addition, he stated that Binance is not authorized to capture customers residing in Brazil.
The association also said that the company violates consumer rights as it creates a “smoke screen” about its operation. Finally, he stated that the company is forming "a voluntary network of autonomous agents / investment consultants" without authorization from the CVM.
"What is noticeable is that there is a worrying disregard for compliance with the Brazilian rules that govern the smooth functioning of the financial and capital markets, which puts investors and the credibility of regulatory and self-regulatory bodies at risk," said Rodrigo Monteiro, managing director executive of ABCripto, in a note.
Also according to Monteiro, the way the company operates abroad gives "an account that this (operation in Brazil) seems to be a deliberate strategy of the company, which further aggravates this concern."
The broker was contacted, but did not send a response until the closing of this matter.
It is worth remembering that the São Paulo Public Prosecutor's Office earlier this year asked the Federal Police to open an investigation to investigate possible irregularities by the company. MPF-SP sued the PF after receiving a complaint made by the Brazilian Securities and Exchange Commission (CVM) in July.
According to the regulator, there are indications that the company offers “securities intermediation services, without authorization from the CVM, a fact that characterizes, at least in the field of evidence, the crime provided for in art. 27-E of Law no. 6386/76 ”.