Brazilian Senator Proposes Law Allowing Police to Block Assets in Electronic Fraud Cases
Senator Fabiano Contarato has introduced a bill that would grant police delegates the authority to block assets, including cryptocurrencies, in cases of electronic fraud without needing a judicial warrant.
The proposed law seeks to amend Brazil’s Penal Code of 1941 by adding Article 244-A. The existing Article 244 allows searches without a warrant under specific circumstances.
“Article 244. A personal search is independent of a warrant in the case of arrest or when there is reasonable suspicion that the person is in possession of a prohibited weapon or objects or papers that constitute evidence of a crime, or when the measure is determined during a home search,” states Decree-Law No. 3,689 of October 3, 1941 (Penal Code).
If Senator Contarato’s bill is approved by the National Congress, it would add a new situation to this article.
“Adds Article 244-A to Decree-Law No. 3,689 of October 3, 1941 (Code of Criminal Procedure), to authorize the Police Delegate to determine, ex officio and on a precautionary basis, the immediate blocking of values, goods, and financial assets in cases of fraud by electronic means (Article 171, § 2º-A of the Penal Code) and fraud in financial applications (Article 171-A of the Penal Code),” the proposal states.
Bill Aims to Address Frauds Involving Pix and Cryptocurrencies
The senator argues that while Pix and internet banking have simplified transactions, they have also created opportunities for digital fraud.
“If, on the one hand, the advent of new payment technologies, such as PIX and Internet Banking platforms, has brought ease and dynamism to financial transactions, on the other hand, it has provided a fertile environment for the practice of large-scale property fraud, characterized by the extreme speed in dissipating the subtracted values,” Contarato explains.
He notes that criminals often act quickly to hide stolen funds, some of which may end up in the cryptocurrency market. He also points to the use of shell bank accounts and transfers abroad.
“In this context, the present proposition seeks to fill a procedural gap that compromises the effectiveness of criminal prosecution in digital financial crimes, conferring on the Police Delegate the prerogative to adopt, ex officio and on a precautionary basis, the immediate blocking of values, goods, and financial assets, in cases of fraud by electronic means (Article 171, § 2A of the Penal Code) and fraud in financial applications (Article 171-A of the Penal Code),” he adds.
The bill stipulates that the asset freeze can last for a maximum of five days, after which the courts must decide on the matter. The senator maintains that even with these new rules, suspects will still have the right to a full defense.
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