Brazilian Federal Judge Vinicius Costa Vidor found Joel Ferreira de Souza, the alleged mastermind of the scheme, guilty of operating an unlicensed financial institution and laundering millions through shell companies and unregulated crypto wallets. According to local media sources, de Souza was accused of laundering millions of dollars.

How Long Are the Sentences?

De Souza received the highest sentence: 128 years in prison. Two other defendants, Gesana Rayane Silva and Victor Veronez, were sentenced to 27 and 15 years in prison, respectively, for managing cash and facilitating transactions in the scheme.

This ruling follows accusations by Brazil’s Federal Prosecutor’s Office (MPF) that five individuals orchestrated a pyramid scheme, raising R$1.11 billion (about $190 million) from approximately 20,000 investors.

Braiscompany promised high returns through crypto trading but allegedly ran a parallel financial system using informal transfers and high-commission operations.

The court also ordered the seizure of R$36 million (around $6.5 million). However, it remains unclear how much the victims will recover. Many of the affected victims’ lawyer, Artêmio Picanço, stated that they need to file civil claims soon before the funds are absorbed by the state.

Two defendants were acquitted due to lack of evidence. The court ruled that the remaining defendants “acted to disguise the illicit origin” of the money, running operations that mimicked legitimate investment practices but actually served to enrich insiders.

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New Bill in Brazil Regulates Crypto Salary Payments

Brazilian lawmakers are considering a new bill that would officially authorize employers to pay salaries using cryptocurrencies like Bitcoin.

Federal Deputy Luiz Philippe de Orleans e Bragança has introduced a bill proposing the regulation of crypto payments for wages, remunerations, and labor benefits.

Filed on March 12, the PL 957/2025 bill legalizes voluntary and partial salary payments in cryptocurrencies like Bitcoin (BTC), but requires employers to pay part of the salary in Brazilian real.

A member of Brazil’s former royal family, Orleans-Bragança is serving his second term as a federal deputy from São Paulo and supports the Truth Social social media platform owned by U.S. President Donald Trump.

Full Crypto Payments Banned, Capped at 50%

The proposed bill prohibits employers from paying salaries entirely in cryptocurrency, capping such payments at 50%.

“Salary payments in virtual assets are prohibited,” but exceptions can be made for expatriate or foreign employees under the regulations of the Central Bank of Brazil.

The bill also allows full crypto payments for “independent service providers,” subject to specific contractual provisions.

Additionally, the portion of the salary paid in Brazilian real must be at least 50% of the total salary.

The conversion of the amount paid in crypto must follow the exchange rate established by an institution authorized by the Central Bank of Brazil.

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According to the information obtained, the House of Representatives also approved the bill, and is expected to be approved by President Luiz Inácio Lula da Silva, who initiated the new income tax regulation.

According to the bill approved by the Senate, Brazilians who earn income over $1,200 (approximately 6,000 Brazilian reais) from abroad will be taxed from January 1, 2024. With this change, foreign and domestic cryptocurrencies are subject to the same tax rate. The tax on money earned before 2024 will be applied when the fund owner reaches the current money. Profits from the funds available until December 31st will be taxed at 8%.

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The bill is expected to cover “special funds”, i.e., investment funds with a single shareholder, and foreign companies operating in the Brazilian financial market. The government plans to generate 20.3 billion Brazilian reais (approximately $4 billion) in tax revenue in 2024 with this practice. However, Senator Rogério Marinho opposed this bill, saying, “Government introduces a new tax because it is a bad manager.”

The President of the Central Bank of Brazil, Roberto Campos Neto, stated in September that they intend to adopt stricter regulations on cryptocurrencies. Campos Neto said this decision was made due to the rapid rise in the popularity of cryptocurrencies and the possibility of tax evasion.

In June, the Brazilian Central Bank acquired regulatory authority over digital asset service providers.

The regulation of crypto-based securities in Brazil is carried out by the Securities and Exchange Commission, which serves a similar function to the United States Securities and Exchange Commission.

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