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Brazilian MP Alfredo Gaspar called Guilherme Haddad, the head of Binance Brazil, to bear witness before parliament as part of an investigation into alleged pyramid schemes in the country. The parliamentary commission of inquiry (CPI) must decide on Gaspar’s request for June 21 on June 27.
Haddad could be forced to answer questions before the Brazilian Chamber of Deputies, depending on the outcome of the vote, according to Brazilian publication Porto do Bitcoin. The request said:
“We can deduce that Binance is fully intertwined with the motivation of this IPC and it becomes fundamental to understand its performance in the country, its relationship with B Fintech (its official representative), as well as its connection with the companies that are legally responsible harm Brazilian consumers.
This comes as Binance, the world’s largest cryptocurrency exchange, grapples with increasing international regulatory pressure. The review came from various corners, including the United States, Australia, the Netherlands and, now, Brazil.
Gaspar further alleged that Binance played a role in aiding pyramid schemes in Brazil with asset transfers, as “on March 11, 2023, the Court of São Paulo blocked R$500,000 reais from Binance for a presumed pyramid”. He highlighted the need to understand Binance’s transactions, its relationship with B Fintech, and any potential affiliations with companies currently facing consumer harm legal issues in Brazil:
“there is also the possible partnership with Brazilian companies that offer financial services that correspond to the scope of what the amendment of the petition for the creation of this CPI proposes to explore.”
Regulators in Brazil said the proposed summons is driven by the global regulatory scrutiny Binance is facing, citing the company’s “inability to meet regulations imposed by individual countries.” Binance’s operations in Brazil are also under investigation by the federal prosecutor’s office and federal police for assistant clients by circumventing a ban on investments in cryptocurrency derivatives.
