Brazil Orders Broker to Liquidate in Money Laundering Fightby and
Central bank says TOV ignored rules to avert money laundering
TOV joins at least five other brokers shut in recent months
Brazil’s central bank ordered TOV Corretora to liquidate amid allegations it didn’t follow rules to prevent money laundering, making it at least the sixth currency broker in recent months to be forced to close.
The central bank cited “serious violations of legal rules” in a decree ordering the liquidation, published on Thursday. TOV allegedly engaged in foreign-exchange contracts for import and financial transfers abroad for significant amounts that weren’t compatible with the size of its clients, while also not consistently identifying its customers, the central bank’s press office said in an e-mail to Bloomberg News. Pocos de Caldas, Brazil-based TOV declined to comment on the liquidation or the accusations.
“In doing so, the brokerage firm took advantage of its status as an institution of the national financial system to perform illegitimate and atypical transactions,” the central bank said. “It failed to adopt measures required by current regulations aimed at preventing money laundering and terrorist financing.”
TOV, which also acts as a stock broker with about 400 employees, joins at least five other brokerages that have been ordered to halt operations and return cash to clients since October for alleged “atypical” transactions. It comes as the central bank steps up efforts to fight money laundering against a backdrop of a sweeping corruption scandal that began at the state-run oil giant Petroleo Brasileiro SA and is reshaping Brazil’s political and business landscape.