CVM slaps massive R$ 48 million fine on ‘Bitcoin Emperor,’ Bitcoin Banco Group, and other accomplices in scam – Shocking revelations!

The “King of Bitcoin,” Cláudio José de Oliveira, along with his company Bitcurrency Moedas Digitais (Bitcoin Banco Group – GBB), partner CLO Participações e Investimentos, and CEO Johnny Pablo Santos, were judged by the Brazilian Securities and Exchange Commission (CVM) for irregular public offering in the capital market.

The CVM unanimously decided to fine Cláudio with R$ 9.25 million ($1.76 million) and Johnny Pablo Santos with R$ 1.85 million ($352,000) for the accusations. Additionally, both Bitcurrency and CLO Participações were fined R$ 18.5 million ($3.51 million) each. The total amount of fines imposed by the CVM for the irregular public offering in the capital market reached R$ 48.1 million ($9.14 million).

According to the CVM’s judgment document, the investigation began in 2019 after receiving complaints about the activities of the Bitcoin Banco Group (GBB) and its platform NegocieCoins. The complaints revealed problems with withdrawals, disappearance of invested capital, and lack of response from the company.

The CVM found evidence of a fraudulent scheme based on an “infinite arbitrage” mechanism between the exchanges NegocieCoins and TemBTC, both belonging to GBB. The CVM also identified the offering of “Bitcoin investment products” online, promising a monthly compensation of 1% and an additional 2-7% performance-based reward for investors.

GBB defended itself by claiming that it did not offer investments but rather “legal transactions with different loan terms and compensation methods.” However, the CVM concluded that the offering of “Bitcoin investment products” constituted a Collective Investment Contract without proper registration, leading to a “stop order” against the company.

The responsibility for the infractions was attributed to Bitcurrency, its partners Cláudio Oliveira and CLO Participações, and its director Johnny Santos.

The Bitcoin Banco Group, led by the self-proclaimed “King of Bitcoin,” promised high returns through investments. However, after the investigations began, Claudio obtained a favorable decision for a request for judicial recovery. Despite this, the group failed to fulfill its obligations under the recovery plan and continued offering collective investment contracts without authorization from the CVM.

In July 2021, the Brazilian Federal Police conducted an operation that resulted in the arrest of Cláudio, his wife, and three other individuals. Except for Cláudio, all suspects were released shortly after. A few days later, the court declared the bankruptcy of the Bitcoin Banco Group.

Last year, Cláudio José de Oliveira was sentenced to 8 years and 6 months in prison and fined for fraud and crimes against the financial system.

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