- Bill to let judges act on their own, or on prosecutors’ requests
- Lawmaker wants to create compensation fund for fraud victims
- Proposal is currently under review in Congress
A member of the Brazilian Congress wants courts to freeze or confiscate cybercrime suspects’ crypto holdings as “a precautionary measure.”
Federal lawmaker Chrisóstomo de Moura unveiled a private member’s bill that, if passed, will let judges issue freeze orders and compensate cyberfraud victims, the Brazilian publication Livecoins reported.
“Adopting these precautionary measures will help protect society,” de Moura said. “The bill will let judges act on their own accord, or at the request of public prosecutors.”
Should the bill win support in Brazil’s lower house, the judiciary would gain sweeping new powers over the country’s registered crypto exchanges.
‘Fight against fraud’
The ability to block fraudsters’ access to crypto wallets would be a “powerful tool that facilitates the fight against fraud,” the congressman said.
One clause in the draft bill reads: “A judge may, ex officio or upon the request of the Public Prosecutor’s Office, take precautionary measures when dealing with the crime of fraud, in any of its forms.”
These precautionary measures would also include new powers to freeze bank accounts and traditional financial assets.
Crypto-related fraud has been on the rise in Brazil in recent years. Crypto-themed pyramid schemes have left ordinary citizens and sports and entertainment stars alike out of pocket.
The bill seeks to address this by creating what de Moura has called a National Fund for the Compensation of Victims of Fraud.
“The establishment of a national fund for fraud victims would be an unprecedented advance in the settlement of fraud damages,” de Moura said. “It will enable officials to offer immediate assistance to individuals and companies who fall victim to fraudsters.”
Harsher penalties for offenders
The congressman said the fund would help “overcome the slow nature of civil compensation protocols and existing budgetary constraints.”
And de Moura has also called for the government to approve “harsher penalties for those who commit crimes in online space,” including “preventive detention.”
He also called on the government to do more to restrict citizens’ access to crypto trading platforms that are “used for criminal activity.”
The congressman concluded that his bill would allow the Brazilian state to “intervene early” and “reduce re-offences.”
The media outlet wrote that the bill is set for a committee review before fellow lawmakers debate the proposal.
“It is expected that it will be some time before the final analysis is complete,” Livecoins explained.
In July, the blockchain investigator ZachXBT said that hackers involved in a cyberattack on one of the Brazilian Central Bank’s infrastructure providers used $40 million worth of fiat to buy Bitcoin, Ethereum, and stablecoins.
Tim Alper is a news correspondent at DL News. Got a tip? Email at tdalper@dlnews.com.
