The Securities and Exchange Commission of Brazil (CVM) released the CVM’s Declaratory Act 20.123 dated September 2nd, 2022 informing about a company that maintains a website and social media profiles for the purchase of cryptocurrencies and other assets, but that does not have the license to act as an intermediary of securities, nor does it integrate the distribution system set forth by Article 15 of Law 6.385, dated December 7th, 1976.
According to Law 6.385, CVM is the relevant government authority responsible for defining the types of financial institutions that are allowed to perform activities in the securities market. Besides that, the securities distribution activity, which includes the sale, promise of sale, and offer to sale or to subscribe securities, requires prior authorization from CVM.
The company in question maintains a website on the internet, in the Portuguese language, which mentions the provision of services such as “investment solutions”, or the sale of “assets” and “contracts”, which has been considered by CVM as a public offering of securities intermediation services, without compliance with the applicable law and regulation.
Accordingly, CVM has determined the immediate suspension of the promotion of the services and imposed a daily punitive fine, to prevent the exercise of such irregular acts, not only by the company itself, but also by all of those that may be identified acting or collaborating in the performance of said acts.
