Colombia -- Licensing Requirements Regulatory Overview

Superintendencia de Industria y Comercio (SIC) is a regulator in Colombia. The Fiscalía General de la Nación is not supported as a regulator for this context by the provided Colombia-specific evidence.

**Entity Targeted:** OmegaPro Group (an international alleged Ponzi scheme), its local promoters, influencers, and related entities operating in Colombia (e.g., Bux Corp, Smart Business Corp).

**Violation Type:** Unregistered and unauthorized financial intermediation, operating a multi-level marketing scheme that promised high returns without proper backing, misleading advertising, consumer fraud, and alleged pyramid scheme.

**SIC:** Fines in the hundreds of millions of Colombian Pesos (COP) against promoters and entities. For instance, in August 2022, the SIC sanctioned "Smart Business Corp SAS," "Bux Corp SAS," and several individuals involved with OmegaPro, imposing fines totaling over COP $2.400 million (approx. USD $600,000 at the time) and ordering the immediate cessation of activities and restitution to affected consumers. Further fines and orders against other promoters followed.

Fiscalía: Ongoing criminal investigations targeting withholding agents for tax-related failures, not specifically for aggravated fraud, illegal financial intermediation, or money laundering, and investigations into President Petro for narco-terrorism and drug trafficking, not the crimes listed in the original claim.

**Date:** SIC actions primarily from **August 2022** and ongoing through **2023**; criminal investigations and arrests have been active throughout this period.

**Outcome:** SIC ordered the cessation of all promotion and operations of OmegaPro-related schemes in Colombia, imposed significant fines, and mandated restitution to affected consumers. The Fiscalía has pursued criminal charges, leading to arrests of key promoters and the freezing of assets. Many victims have lost significant sums, and the full extent of recovery is uncertain.

**SIC Press Release (August 2022):** https://www.sic.gov.co/noticias/la-sic-multa-y-ordena-el-cese-de-actividades-de-promotores-de-esquemas-de-negocio-en-los-que-se-captaban-recursos-del-publico-y-advierte-sobre-los-riesgos-de-omegapro

**El Tiempo Article (October 2023, detailing collapse and criminal investigations):** https://www.eltiempo.com/unidad-investigativa/omegapro-la-piramide-mas-grande-en-colombia-su-caida-y-los-impactantes-datos-de-su-creador-820876

**Entity Targeted:** Daily Cop S.A.S. and its founders/promoters (e.g., Camilo Andrés Suárez Aldana, David Mateo Suárez Aldana).

**Violation Type:** Alleged pyramid scheme, unauthorized and illegal financial intermediation using cryptocurrencies as a front, offering unrealistic returns, consumer fraud.

**SIC:** Imposed fines of over COP $500 million (approx. USD $125,000 at the time) against the company and its managers, ordered the immediate cessation of its operations, and mandated the return of funds to investors.

**Fiscalía:** Criminal charges for illegal mass capture of money, aggravated fraud, and money laundering. Arrests and asset seizures.

**Date:** SIC action in **November 2022**; criminal investigations and arrests followed into **2023**.

**Outcome:** SIC issued a definitive resolution ordering the immediate cessation of Daily Cop's activities, imposing fines, and requiring restitution. The Fiscalía subsequently arrested key figures behind the scheme and initiated criminal proceedings, uncovering millions of dollars in alleged fraud.

**SIC Press Release (November 2022):** https://www.sic.gov.co/noticias/sic-multa-y-ordena-el-cese-de-actividades-a-daily-cop-s-a-s-por-captacion-no-autorizada-de-recursos-del-publico

**El Tiempo Article (August 2023, on arrests):** https://www.eltiempo.com/justicia/capturan-a-los-cabecillas-de-la-piramide-daily-cop-que-prometia-ganancias-con-criptomonedas-802526

**Regulator(s):** Fiscalía General de la Nación (Attorney General's Office). (The primary regulator in Argentina, where Generación Zoe originated, was the Comisión Nacional de Valores (CNV) and judicial authorities).

**Entity Targeted:** Local promoters and affiliates of the international Generación Zoe scheme operating in Colombia.

**Violation Type:** Alleged illegal financial intermediation, fraud, and operating a Ponzi/pyramid scheme under the guise of coaching and crypto investments.

**Penalty Amount:** Arrests and criminal charges against Colombian operators. Assets linked to the scheme were seized.

**Date:** Arrests and investigations in Colombia began in **early 2022**, following international alerts and actions in Argentina.

**Outcome:** Colombian authorities, working with international counterparts, arrested individuals linked to Generación Zoe's operations in the country. Criminal proceedings are ongoing for charges related to aggravated fraud and illegal financial intermediation.

**Fiscalía Press Release (March 2022, mentioning international cooperation):** https://www.fiscalia.gov.co/colombia/noticias/por-captacion-ilegal-de-dinero-la-fiscalia-imputo-a-cinco-personas-y-logro-medida-de-aseguramiento-contra-dos-de-ellas/ (While not specifically naming Zoe, this reflects the type of coordinated actions against such schemes at the time.)

**La República Article (March 2022, detailing Zoe's presence in Colombia):** https://www.larepublica.co/especiales/generacion-zoe/generacion-zoe-el-esquema-ponzi-que-tambien-operaba-en-colombia-3323537

**Ley 2143 de 2021 (Law 2143 of 2021):**

**Purpose:** Establishes the legal framework for the Regulatory Sandbox (La Arenera) and mandates the Financial Superintendency to propose a comprehensive regulatory framework for crypto assets.

**Reference:** *Ley 2143 de 2021, por medio de la cual se crea un marco regulatorio para el funcionamiento de los entornos de prueba o “sandboxes” regulatorios para proyectos de innovación financiera, y se dictan otras disposiciones.*

**URL:** http://www.suin-juriscol.gov.co/viewDocument.asp?id=30043818 (Diario Oficial, Government of Colombia)

**Circular Externa 026 de 2020 (SFC):**

**Purpose:** Officially established the regulatory sandbox "La Arenera" for financial innovation projects. This circular sets out the rules for participation.

**Reference:** *Circular Externa 026 de 2020 de la Superintendencia Financiera de Colombia, "Por medio de la cual se establecen las instrucciones para la operatividad de los entornos controlados de prueba - “Sandbox” en el sector financiero."*

**URL:** https://www.superfinanciera.gov.co/jsp/Publicaciones/publicaciones/loadContent/20428 (Superintendencia Financiera de Colombia)

**Circular Externa UIAF 001 de 2021 (and predecessors like 006 de 2020):**

**Purpose:** Updates and consolidates instructions for the prevention and control of money laundering and terrorist financing for Virtual Asset Service Providers (VASPs) and other obliged entities. It explicitly identifies VASPs as obliged entities for AML/CFT purposes.

**Reference:** *Circular Externa UIAF 001 de 2021, "Por medio de la cual se actualizan las instrucciones para la prevención y el control del lavado de activos y la financiación del terrorismo – LA/FT, de las actividades y profesiones no financieras designadas y otros sujetos obligados."* (This circular generally covers various sectors but includes provisions relevant to VASPs as obliged entities). The previous UIAF Circular Externa 006 de 2020 specifically included virtual asset operators as obliged entities.

**URL:** https://www.uiaf.gov.co/noticias-eventos/noticias/uiaf-expide-nueva-circular-externa-para-aumentar-cobertura-del-splaft (UIAF announcement, links to the actual circular)

**Direct link to 006 of 2020 (still foundational for VASP inclusion):** https://www.uiaf.gov.co/documentos/circulares-externas/circular-externa-006-de-2020-218

**Investment Tokens/Security Tokens:** Tokens explicitly marketed or designed to represent an ownership interest, a share in profits, debt, or other financial claims in an entity or project. This includes tokens that grant voting rights, profit-sharing, or liquidation rights.

**Tokens from Initial Coin Offerings (ICOs) or Security Token Offerings (STOs):** If an ICO or STO involves the sale of tokens that promise a return on investment based on the development and efforts of the issuer, it will likely be treated as a public offering of securities.

**Utility Tokens with Investment Characteristics:** Even if initially presented as utility tokens (for accessing a service or product), if they are promoted primarily as an investment opportunity with an expectation of future appreciation driven by the issuer's efforts, they can be reclassified as securities. The SFC looks at how they are marketed, sold, and the reasonable expectation of purchasers.

**Tokens Linked to Collective Investment Schemes:** Tokens that represent participation in a fund or a pooled investment managed by a third party, where the token holder expects returns from that management.

**"Pure" Utility Tokens:** Tokens that exclusively grant access to a specific product or service and are primarily used for that purpose, with no significant investment expectation.

**Cryptocurrencies (like Bitcoin or Ethereum):** Generally, widely decentralized cryptocurrencies are not currently viewed as securities by the SFC, but rather as "virtual assets" or "digital assets" that can function as a medium of exchange or store of value, with associated risks.

**Certain NFTs:** NFTs primarily intended as unique digital collectibles, art, or access passes, without an explicit investment scheme or expectation of profit derived from a common enterprise. However, NFTs that fractionize ownership of real estate, art, or represent shares in a profit-generating venture *could* be deemed securities.

**Registration with the SFC:** The issuer must register the token as a security with the SFC and include it in the **Registro Nacional de Valores y Emisores (RNVE)**, the National Securities and Issuers Registry.

**Disclosure Requirements:** Comprehensive disclosure of financial information, business plans, risks, and governance structures, similar to traditional public offerings.

**Prospectus:** Preparation and approval of a detailed prospectus.

**Corporate Governance:** Compliance with corporate governance standards for publicly traded entities.

**Ongoing Reporting:** Continuous reporting obligations to the SFC and the public.

Colombia's securities law has limited exemptions. Private placements (offers to a small, qualified group of investors) might have lighter registration requirements but are still regulated.

**Regulatory Sandbox (La Arenera):** The closest mechanism for innovation is the SFC's **La Arenera**, a regulatory sandbox established under **Circular Externa 021 de 2023**. This allows financial entities (and in certain cases, non-supervised entities in partnership with supervised ones) to test innovative financial services, including those involving crypto assets, under a controlled environment with temporary waivers or specific authorizations. However, participating in La Arenera does not *exempt* a token from being classified as a security; rather, it allows for a structured dialogue and potential adaptation of regulations if a security token is being tested.

**Regulated Exchanges:** Trading must occur on authorized and supervised exchanges, primarily the **Bolsa de Valores de Colombia (BVC)** or other SFC-licensed trading systems.

**Market Intermediaries:** Trades must generally be executed through SFC-licensed brokers or market intermediaries.

**Investor Protection:** Rules regarding market manipulation, insider trading, transparency, and best execution would apply, similar to traditional securities.

**Warnings and Alerts:** The SFC frequently issues **public warnings and press releases** cautioning investors about the high risks associated with cryptocurrency investments, emphasizing that they are generally not regulated financial products or securities in Colombia and therefore lack the associated investor protections. These warnings serve as a de facto enforcement mechanism to inform the public and deter non-compliant offerings.

**Example:** Constant reiteration that virtual assets are not considered legal tender or securities and that institutions under SFC supervision are not authorized to custody, invest, or intermediate operations with them (outside of the sandbox).

**Prohibition on Supervised Entities:** The SFC has consistently **prohibited financial institutions under its supervision** (banks, brokers, funds) from directly engaging in activities involving crypto assets (e.g., holding, investing, offering services related to them) outside of the controlled environment of the regulatory sandbox. This is a strong indirect enforcement measure that limits the institutional market for potentially unregulated tokens.

**Actions Against Pyramid Schemes and Fraud:** While not directly securities law enforcement, Colombian authorities (including the SFC, Fiscalía General de la Nación, and Superintendencia de Sociedades) have taken action against **crypto-related pyramid schemes and Ponzi schemes**. These cases are typically prosecuted under general fraud laws, consumer protection laws, or illicit fundraising laws, rather than securities laws, because the *fraudulent nature* is more overt than a mere regulatory classification issue.

**Example:** Crackdowns on entities like **Daily Cop** or **Omegapro**, which operated with promises of high returns through crypto investments, leading to investigations and arrests for illicit fundraising and fraud, though not always explicitly under securities market regulations.

**Regulatory Sandbox (La Arenera) as a Pathway:** While not an enforcement action, the implementation of **La Arenera** is a regulatory tool. If an innovative financial service involving a crypto token is tested in the sandbox and is determined to be a security, the SFC would then provide guidance on how it must be regulated, potentially leading to a formal registration requirement upon exiting the sandbox. This proactive approach aims to guide innovation rather than simply punish it after the fact.

**Ley 964 de 2005 (Securities Market Law):** Defines securities and sets out the framework for public offerings and secondary trading.

Ley 964 de 2005 - Secretaria Senado

**Circular Externa 021 de 2023 (SFC - Regulatory Sandbox Framework - La Arenera):** Establishes the framework for testing financial innovations.

Circular Externa 021 de 2023 - SFC

*Example of a relevant concept:* While not specifically classifying a token as a security, **Concepto 2022137682-001 (SFC)** discusses NFTs and applies principles that are indicative of their general approach to digital assets, differentiating based on characteristics (utility, investment expectation, etc.). This demonstrates the *substance over form* approach. (You would need to search for this specific number on the SFC site).

**SFC Press Releases and Warnings:** These are regularly updated on the SFC's main website.

Noticias y Comunicados de Prensa - SFC

**Cautious but Open:** Regulators acknowledge the potential of virtual assets while emphasizing the associated risks (volatility, fraud, money laundering, consumer protection).

**Experimental/Exploratory:** The regulatory sandbox "LaArenera" was a prime example of this.

**Focus on AML/CFT:** Anti-Money Laundering and Counter-Financing of Terrorism (AML/CFT) compliance is a primary concern and has seen some of the earliest formal guidance.

**No Legal Tender Status:** Cryptocurrencies are explicitly not recognized as legal tender.

**Ongoing Legislative Efforts:** The main driver for comprehensive regulation is a pending bill in Congress.

**Superintendencia Financiera de Colombia (SFC)** (Financial Superintendence of Colombia)

**Banco de la República** (Central Bank of Colombia)

Colombia's president has actively endorsed Bitcoin mining as an economic opportunity, signaling a shift away from a purely cautious stance, though cryptocurrency is still not legal tender.

**Unidad de Información y Análisis Financiero (UIAF)** (Financial Information and Analysis Unit)

**Role:** The AML/CFT authority. It has issued specific guidelines for virtual asset service providers (VASPs) to report suspicious transactions, even in the absence of a comprehensive regulatory framework.

**Ministerio de Hacienda y Crédito Público** (Ministry of Finance and Public Credit)

**Role:** Involved in setting fiscal policy and supporting the development of legislative frameworks related to financial innovation.

**Proyecto de Ley 139 de 2022 (Senate) / 028 de 2022 (House) - "Ley de Activos Virtuales" or "Fintech Bill"**

**Name:** Project of Law 139 of 2022 (Senate) / Project of Law 028 of 2022 (House) – Aims to create a regulatory framework for virtual assets.

**Date:** Introduced in 2022 (building on previous legislative attempts).

**Status:** **Currently pending in the Colombian Congress.** It has gone through several debates and amendments but has not yet been enacted into law.

**Purpose:** To define virtual assets, establish licensing requirements for Virtual Asset Service Providers (VASPs), introduce rules for consumer protection, promote financial stability, and ensure AML/CFT compliance within the crypto ecosystem. This bill, if passed, would significantly formalize crypto regulation in Colombia.

**LaArenera - Regulatory Sandbox (SFC)**

**Date:** Launched in early 2021, its pilot phase concluded.

**Purpose:** The SFC created this sandbox to allow traditional financial institutions to partner with selected cryptocurrency exchanges for controlled pilot programs. The goal was to understand the operational risks and opportunities, primarily focusing on enabling fiat on/off-ramps (deposits and withdrawals) for customers of these exchanges through regulated banks.

**Outcome:** Provided valuable insights for future regulation, demonstrating a willingness by the SFC to study and understand crypto operations under controlled conditions.

**URL (Information available on SFC's site):** Search for "LaArenera" or "Sandbox" on the SFC website.

**Circular Externa 027 de 2020 (UIAF)**

**Name:** External Circular 027 of 2020.

**Purpose:** Issued by the UIAF, this circular establishes guidelines for Virtual Asset Service Providers (VASPs) to comply with AML/CFT obligations. It mandates registration, customer due diligence, and reporting of suspicious transactions. This was a crucial step in bringing some level of oversight to the crypto sector from an anti-financial crime perspective.

**URL (Can be found on UIAF's website):** Search for "Circular Externa 027 de 2020 UIAF" on their official site.

**Legality:** Owning and trading cryptocurrencies is **not prohibited** in Colombia. Citizens are free to buy, sell, and hold virtual assets.

**Unregulated Market:** However, the trading environment is largely **unregulated** from a financial services perspective (pending the "Ley de Activos Virtuales"). This means:

**No specific licensing regime for exchanges:** Crypto exchanges currently operate under general commercial law, not as regulated financial institutions supervised by the SFC (except for those that participated in the LaArenera sandbox pilots).

**Consumer Protection Gaps:** There is no specific legal framework for consumer protection in crypto transactions, leaving users exposed to risks like platform failure, hacks, and scams without clear recourse to financial regulators.

**Banking Relations:** While the sandbox aimed to improve this, many traditional banks remain cautious or refuse to directly service crypto exchanges or businesses due to regulatory uncertainty and AML/CFT risks, making banking access challenging for the industry.

**AML/CFT Obligations:** Despite the lack of comprehensive financial regulation, VASPs are expected to comply with UIAF's Circular 027 of 2020, meaning they must implement robust AML/CFT controls.

**Taxation:** For tax purposes, cryptocurrencies are generally considered **intangible assets**. Capital gains derived from their sale are subject to income tax. The DIAN (Dirección de Impuestos y Aduanas Nacionales – National Tax and Customs Directorate) has provided some guidance, but comprehensive tax regulations specifically for crypto are still developing.