Authorities of Brazil Develop DLT Platform for Screening Politicians

Four of Brazil’s financial regulators are cooperating to create a streamlined DLT-driven data-sharing platform to conduct background checks on political representatives and corporations.

The blockchain platform, known as PIER, was developed by Brazil’s central bank Banco Central do Brasil (BCB). The platform saw initial participation from the BCB, the Brazilian private insurance superintendent, and the local securities regulator to inform its database.

Brazil’s social security supervisor plans to soon take part in the program too. The Brazilian government is also considering including data collected by the country’s judiciary, trade boards, and international financial bodies into the PIER system.

Brazilian regulators use DLT to streamline data

Daniel Bichutte, the deputy head of the BCB’s financial system organization department, says that the streamlining of inter-departmental data is “drastically reducing” the amount of time needed to assess the financial background of an entity.

Institutions issuing requests to the PIER database are able to quickly access data “from punitive processes and restrictions from companies and administrators,” an entity’s “history of performance in the financial system”, including technical capacity and organization conduct, and “information on the participation of individuals and legal entities in the share capital and shareholding control.”

Adalberto Felinto da Cruz Júnior, the executive secretary of the central bank, said that the collaboration has been a “particularly fruitful” effort that laid foundation for “important synergies” between the regulatory authorities involved.

Blockchain technologies limit opportunities for corruption

Eduardo Weller, a software specialist with the BCB said that leveraging distributed ledger technology (DLT) for PIER allows the use of a “a decentralized, tested technology, whose native functionalities mean that there is no need to build the system from scratch.”

Weller stresses that digital signatures guarantee the “authenticity of messages exchanged”; the “integrity of data recorded,” and “eliminates a single point of failure [and] central entity that can defraud data.”

PIER has been under construction for approximately two years, having first been announced by the central bank in June 2018.