Ministry of Finance BBOM investigation suspended
Just days after Judge Reynaldo Fonseca openly declared in court that BBOM was indeed a pyramid scheme, another Brazilian Judge has prohibited the Ministry of Finance from further investigating the company.
In granting an injunction last Friday (8th November), Judge Antonio Claudio Macedo da Silva, put a stop to the Ministry of Finance’s BBOM investigation, explaining that
(The Ministry of Finance) has no jurisdiction to act in the case of BBom, since there was no evidence that the company was engaging in the “capturing” of people’s savings, or any improper practice that run contrary to antitrust law, which protects free competition and activities within the purview of the board.
Right. Except for y’know… BBOM’s business model, which clearly hinges on the continued investment of new affiliates to sustain guaranteed payouts to existing affiliates. Nevermind the fraudulent claims by the company to be selling GPS tracker units that don’t exist to retail customers to who don’t exist, all the while only supplying them to participating affiliates.
Despite federal prosecutors in Goiás being able to present this “evidence” in court on Monday, it seems that on Friday the Ministry of Finance were unable to reproduce the same. At least not with any conviction.
Judge da Silva acknowledged
there may be “wrong, or even improper practices” not yet found (in BBOM’s business model), (but) in the rapid analysis conducted for the granting of this injunction, evidence of undue seizing of people’s savings by BBOM (was not found).
In my “non-exhaustive” analysis, I did not see a financial pyramid business model being operated by the company (BBOM).
Whether Judge da Silva conducted his own evidence or that which was presented by the Ministry of Finance is unclear.
Either way, what a big fat fail by the Ministry. As a regulation agency how do you let something like that slip through your fingers?
Whether or not the Ministry will appeal the decision in unclear, at the time of publication the Ministry had not returned emails or telephone calls made by iG requesting an official statement.
If the Minstry do go for the appeal, can I suggest they hook up with Goiás’ federal prosecutors and get a proper analysis of BBOM’s comp plan before fronting court again?
On the other hand, if they can’t even convince a Judge that an obvious Ponzi scheme is indeed a Ponzi scheme, perhaps it’s for the best they stay out of the investigation arena for now.
Meanwhile with the Ministry of Finance now ordered to sit idly on their thumbs, the BBOM case remains in the hands of Goiás’ federal prosecutors, who are pushing a civil case to disband the company. BBOM also currently faces a criminal case in São Paulo, under charges of ‘embezzlement, crimes against the national financial system and operation of a financial institution without authorization‘.