By Marcela Ayres
BRASILIA (Reuters) -Banco do Brasil has asked Brazil’s solicitor general to act against false claims that allege it is poised to face sanctions by the U.S. government because one of its clients is a judge sanctioned under the U.S. Magnitsky Act, according to a document dated Friday and seen by Reuters.
The state-run lender warned of “undesirable consequences” if the social media posts are not swiftly curbed, and said clients had sought clarification amid a wave of such posts.
The posts included some from federal lawmakers, the bank added, urging legal steps to curb “potential and existing damage to the National Financial System.”
The solicitor general said it had referred the case to federal police, requesting a criminal investigation into the spread of fake news, warning such actions “could trigger a bank run, causing harm to the country’s economy.”
In response to questions from Reuters, Banco do Brasil referred to a statement it released on Friday that said it would take legal steps to defend its reputation after identifying “false and malicious” posts aimed at inciting panic and suggesting a run on deposits.
The bank added that under Brazilian law, spreading false or incomplete information about financial institutions carries a prison sentence of up to six years, as well as fines.
Banco do Brasil’s troubles are at the heart of deteriorating U.S.-Brazil ties.
Last month, U.S. President Donald Trump imposed steep tariffs on Brazilian goods, as well as sanctions on Alexandre de Moraes, the judge overseeing the case in which former right-wing President Jair Bolsonaro is accused of plotting to overturn his defeat in the 2022 elections.
The U.S. measures freeze assets and bar firms from dealing with designated individuals. Given the global reach of the U.S. financial system, foreign banks often broaden restrictions to sanctioned individuals to avoid secondary sanctions.
Amid the uncertainty, shares of Brazil’s banks have come under pressure. Shares of Banco do Brasil, which handles payroll for the Supreme Court, fell 2.2% on Monday following sharp losses last week.
(Reporting by Marcela Ayres in Brasilia; Editing by Matthew Lewis)
