SEC Brings FCPA Action Against Brazil's Second Largest Airline

SEC Charges Gol Intelligent Airlines, Brazil’s Second Largest Airline, with FCPA Violations

The Securities and Exchange Commission today charged Brazil’s second largest domestic airline, GOL Linhas Aéreas Inteligentes, for violating the Foreign Corrupt Practices Act (FCPA). The São Paulo-based company, also known as Gol Intelligent Airlines, agreed to pay $70 million to settle the SEC charges.

According to the SEC’s order, Gol bribed prominent Brazilian government officials in exchange for certain favorable payroll tax and aviation fuel tax reductions. The scheme took place against a backdrop of insufficient internal accounting controls, and the bribes were characterized as legitimate business expenses in Gol’s recordkeeping.

Justice Department Forms National Network of Prosecutors Focused on Crypto Crime

The Justice Department has tapped more than 150 federal prosecutors across the country to bolster law enforcement’s efforts to combat the rise in crime linked to the use of cryptocurrencies such as bitcoin, officials said.

The Digital Asset Coordinators Network is intended to designate subject-matter experts in U.S. attorneys’ offices on the complex technical and legal complications posed by cryptocurrency cases, the officials said. The Biden administration is announcing the new effort Friday alongside the release of a broader set of frameworks from other agencies concerning regulatory approaches to developing the digital currency ecosystem. Eun Young Choi is the first director of the Justice Department’s national cryptocurrency enforcement team.

The network was motivated in part due to the high degree of technical expertise that can go into prosecuting cryptocurrency cases, as well as digital currencies’ increasing popularity across several different areas of crime, said Eun Young Choi, the first director of the Justice Department’s national cryptocurrency enforcement team. Those areas of crime include money laundering or financing terrorism, a vehicle of payment for ransomware hackers, and a direct target of theft, she added.

Biden’s Executive Order Produces Few Answers in Crypto Reports From US Treasury

Crypto firms have been eagerly awaiting a series of U.S. government reports they hoped would clarify what the Biden administration and regulators intend to do about digital assets. Most of the documents are out now, but the picture remains murky.

The reports from the Treasury Department – three of them released Friday – largely recommend the government continue assessing crypto risks, keep up enforcement actions and push forward with work on a digital dollar (without recommending the U.S. should have one).

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The reports are a response to President Joe Biden’s executive order on digital assets, signed in March, which directed federal agencies to analyze different aspects and issues around the cryptocurrency ecosystem and provide recommendations for how the U.S. can both be a leader in the digital asset sector worldwide, as well as address any monetary stability or consumer protection risks posed by the burgeoning industry. Agencies will publish a total of 21 reports.

Former SEC Ombudsman Misled Congress, Lied to IG, Probe Alleges

The SEC official charged with helping the public navigate the agency’s complex system lied to investigators, added misleading information in reports to Congress, and didn’t log hundreds of entries into the agency’s tip program, according to the summary of an inspector general’s report.

The summary, dated August 29, found that the Securities and Exchange Commission’s ombudsman didn’t log hundreds of fraud claims by retail investors into the internal tip program, as required. When confronted in 2021, the ombudsman created a spreadsheet that falsely claimed tips generated by others were done by her office, the report said. The problems surfaced during a 2021 Inspector General audit of the SEC’S tips, complaints and referrals program (TCR), according to the investigative summary.

Frequently Asked Questions – Newly Added | U.S. Department of the Treasury

1076. What is prohibited as a result of OFAC’s designation of Tornado Cash?

On August 8, 2022, OFAC designated the entity Tornado Cash for facilitating the laundering of proceeds of cybercrimes, including those committed by the Lazarus Group, a North Korea state-sponsored hacking group that was sanctioned in 2019. As described in FAQs 561 and 562, OFAC may include as identifiers on the Specially Designated Nationals and Blocked Persons List (SDN List) specific virtual currency wallet addresses associated with blocked persons. As part of the SDN List entry for Tornado Cash, OFAC included as identifiers certain virtual currency wallet addresses associated with Tornado Cash, as well as the URL address for Tornado Cash’s website. The Tornado Cash website has since been deleted from the Internet, but it currently remains available through certain Internet archives.

While engaging in any transaction with Tornado Cash or its blocked property or interests in property is prohibited for U.S. persons, interacting with open-source code itself, in a way that does not involve a prohibited transaction with Tornado Cash, is not prohibited. For example, U.S. persons would not be prohibited by U.S. sanctions regulations from copying the open-source code and making it available online for others to view, as well as discussing, teaching about, or including open-source code in written publications, such as textbooks, absent additional facts. Similarly, U.S. persons would not be prohibited by U.S. sanctions regulations from visiting the Internet archives for the Tornado Cash historical website, nor would they be prohibited from visiting the Tornado Cash website if it again becomes active on the Internet.

Ether’s New ‘Staking’ Model Could Draw SEC Attention

Ethereum’s big software update on Thursday may have turned the second-largest cryptocurrency into a security in the eyes of a top U.S. regulator.

Securities and Exchange Commission Chairman Gary Gensler said Thursday that cryptocurrencies and intermediaries that allow holders to “stake” their coins might pass a key test used by courts to determine whether an asset is a security. Known as the Howey test, it examines whether investors expect to earn a return from the work of third parties.

“From the coin’s perspective…that’s another indicia that under the Howey test, the investing public is anticipating profits based on the efforts of others,” Mr. Gensler told reporters after a congressional hearing. He said he wasn’t referring to any specific cryptocurrency.

Coinbase Is Going to Highlight Politicians by Their Crypto-Friendliness

Coinbase Global Inc. is adding a scorecard for politicians right into its app as the largest US cryptocurrency exchange amps up its policy advocacy efforts after expressing frustration with lawmakers and regulators.

American customers can check crypto sentiment scores for members of Congress based on their past statements, Brian Armstrong, chief executive officer of Coinbase, wrote in a series of tweets Wednesday. They can also register to vote and find out about local town hall events.