Brazil targets crypto loot in amendment of cyber fraud laws

Brazil’s Chamber of Deputies is attempting to include cryptocurrency in the country’s anti-fraud enforcement toolkit. 

A key committee in the Chamber of Deputies has voted to let judges freeze suspects’ crypto holdings and impose prison terms of up to 10 years for electronic fraud. The bill still needs to pass through several approval stages before it can be considered law. 

How does Brazil handle crypto in fraud investigations? 

The official Chamber of Deputies news service announced that the Finance and Taxation Committee (CFT) has approved Bill 5819/2025, which was authored by Representative Coronel Chrisostomo and backed by committee rapporteur Kim Kataguiri. 

Under the new law, both the Penal Code and the Code of Criminal Procedure will raise the sentencing range for fraud committed through social media, phone, email, or other digital channels from the current four-to-eight-year window to six to 10 years. The punishment also includes fines.

Judges are set to gain new powers enabling them to order the freezing of bank accounts and crypto wallets held by suspects as a precautionary measure. Courts will also be able to block access to real estate, prohibit contact with victims, and restrict a suspect’s use of social media and digital payment systems.

In cases where the victim’s losses exceed 100 minimum wages or where investigators can prove the perpetrator is a flight risk, the court can impose preventive detention. If the fraud involves a structured criminal organization, courts are now to add one-third to the base sentence.

Brazil refuses to be soft on crypto crime

Brazil has been attempting to curb the spread of crypto crime not just through legislation, but also through on-the-ground operations. For instance, in September 2025, the Federal Police carried out Operation Lusocoin. The target was a network accused of laundering more than 3 billion reais (roughly $540 million) through cryptocurrency, shell companies, and a proprietary token. 

11 individuals were eventually arrested, and assets across 65 individuals and entities were frozen.

The enforcement streak goes way back to 2022, when Brazilian Federal Police and U.S. Homeland Security Investigations raided locations linked to Francisley Valdevino da Silva, known as the “Bitcoin Sheik.” He was accused of running a transnational cryptocurrency fraud ring that allegedly stole nearly $800 million from investors across multiple countries.

More recently, three operators of the Braiscompany Ponzi scheme received combined sentences of 170 years after defrauding some 20,000 investors of approximately 1.1 billion reais ($190 million). 

Bill 5819/2025 is now headed to the Constitution, Justice, and Citizenship Committee (CCJ). If it clears that level, it must pass votes in both the full Chamber and the Senate before reaching the president’s desk for signature.