Binance’s legal woes intensify as Brazil lawmaker seeks to question general manager

Binance, already under regulatory fire in jurisdictions worldwide, is seeing its legal pressures exacerbated in Brazil, where lawmaker Alfredo Gaspar has formally requested that the National Congress compel Guilherme Haddad Nazar, General Manager of Binance Brazil, to appear for questioning.

In a formal request addressed to the Parliamentary Commission of Inquiry into Pyramid Schemes, Gaspar called upon the commission to Summon Mr. Nazar to “provide clarifications regarding the company’s operations in cryptocurrency management… and possible partnerships with national companies involved in financial services associated with cryptocurrencies.”

As justification, Gaspar cited the U.S. Securities and Exchange Commission’s civil suit against Binance Holdings, Ltd. and its affiliates for several allegations of securities law violations. He also cited the Brazilian Securities and Exchange Commission’s decision to reopen an administrative proceeding against Binance and its Brazilian representative, B Fintech, while a São Paulo court froze 500,000 Brazilian Real from Binance due to suspicions of operating a pyramid scheme.

Gaspar also noted that Binance or one of its affiliates faced similar inquiries in Japan, China, Germany, and the United Kingdom, writing, “A common thread in these cases is the company’s failure to comply with the regulations imposed by each country.”

Binance pulling out of markets

As authorities ramp up the pressure, Binance has begun to pull out of markets that seem less viable in the face of enforcement action: In the U.K., it withdrew its FCA registration application on June 19. Prior to that, on June 15, it ceased operations in the Netherlands altogether after it failed to secure a critical VASP license.

On June 13, Binance.US ceased support for USD trading pairs, opting to continue operations a “crypto-only” exchange as its U.S. banking partners ended their relationships with the embattled exchange.

Guilherme Haddad Nazar, who was appointed to his position in December 2022, is the nephew of Fernando Haddad, Brazil’s Minister of Finance. He previously held leadership positions at Uber and Loft.

Alfredo Gaspar de Mendonça Neto is a Federal Deputy in Brazil’s Chamber of Deputies, one of two legislative houses making up its National Congress. A former prosecutor, Gaspar’s background includes coordinating the State Group to Combat Criminal Organizations and serving as both Secretary of State for Social Defense and as Attorney General of Justice for the Public Ministry of Alagoas.

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