The Brazilian Congress has announced that it is considering an indictment accusing Binance CEO Changpeng Zhao and three local Binance executives of fraud and financial crimes. Additionally, the congressional committee stated that it had evaluated the results of an investigation into financial pyramid schemes in Brazil before making these allegations.
What Are These Charges?
In its released report, the committee alleged that Binance, Zhao, and others had established “a network of opaque legal entities, all directly or indirectly controlled by Zhao, with no defined business purpose other than evading compliance.”
Committee Calls for an Investigation
Furthermore, the committee recommends that the Federal Public Ministry initiate an investigation into all of Binance’s operations based in Brazil, particularly focusing on tax evasion, money laundering, organized crime, and financing of terrorism.
Additionally, the committee suggests that the Brazilian Securities and Exchange Commission (CVM) initiate an investigation into Binance’s derivative product sales.
These Recommendations Have No Legal Validity
It’s important to note that these recommendations do not have any legal validity, and the ultimate decision will be made by local authorities and the government of the region.
Finally, Binance expressed its strong commitment to cooperating with the committee and local law enforcement authorities regarding these allegations.