In a recent development emerging from Brazil, a congressional committee has taken a significant step by recommending potential indictments for four high-ranking officials connected to the Binance cryptocurrency exchange.
These officials in question are CEO Changpeng Zhao, local Binance executives Daniel Mangabeira, Guilherme Haddad Nazar, and Thiago Carvalho.
The core allegations revolve around concerns of fraudulent management, unauthorised financial institution operations, and potential violations of Brazil’s national financial system regulations.
It is crucial to underline that this recommendation is a preliminary step from the committee, and the Brazilian police will now decide the next course of action.
Furthermore, a comprehensive 508-page report primarily delves into potential irregularities associated with crypto-related companies.
Binance has adamantly refuted these allegations and reaffirmed its unwavering commitment to close cooperation with the commission.
They express their strong objection to what they deem as “baseless accusations” that could harm their reputation.
Binance stated that it has made efforts to work with the Brazilian congressional committee and stated:
“[Binance] strongly rejects any attempts to make [it] a target or even expose its users and employees with allegations of bad practices without any proof, amid competitive disputes given the company’s leadership position in Brazil and in the world.”
Binance also underscores its rigorous global compliance programme, highlighting ongoing collaboration with international authorities in the fight against cybercrimes.
The report has also suggested the potential indictment of 45 other individuals based on what is described as “strong evidence” of their alleged involvement in various criminal schemes.
The individuals listed have affiliations with numerous cryptocurrency-related entities, such as the travel company 123milhas, the crypto project 18K Ronaldinho, and several others.
The same congressional committee has called upon Brazil’s securities regulator, the Comissão de Valores Mobiliários (CVM), to scrutinise Binance’s derivatives sales, following a previous stop order.
These investigations were initiated in April.
Notably, the CVM rejected a 2 million reais ($396,000) settlement proposal from Binance in August, indicating that the exchange may now face additional fines and penalties.