Brazil: Federal police investigate corruption in charging mining royalties

The Federal Police (PF) launched Operation Timóteo on Friday (Dec. 16) morning, with actions in 11 states and the Federal District, where a criminal organization is investigated for a corruption scheme in charging mining royalties.

In addition to 52 search warrants, 300 police officers also carry out 29 bench arrest, 4 pre-trial detention warrants, 12 temporary arrest warrants, sequestration of three properties and legal freeze of funds that may reach $20.7 million.

According to the PF, federal courts also ordered the municipalities involved in the scheme not to make any process of hiring or payment to the three law and advisory firms being probed.

The police reported that the evidence gathered shall provide details on how the scheme worked, in which the head of the National Department of Mineral Production (DNPM), "holder of inside information on royalties," offered services through two law firms and an advisory firm to municipalities with funds in mining companies.

As far as the Federal Police were able to map, the criminal organization investigated was divided into at least four central cores, one of which, the political core, was formed by political agents and civil servants responsible for hiring the law firms involved in the scheme.

According to the PF, "there is a religious leader among those being investigated for money-laundering support. He allegedly received money from the main law firm responsible for the scheme." They are probing whether this religious leader 'lent' bank accounts of a religious institution for which he is responsible, with the intention of concealing the illicit origin of the money."

The Operation Timóteo began in 2015, when the Office of the Comptroller-General (CGU) sent to the Federal Police an indictment that indicated incompatibility in the asset development of one of DNPM's directors. This public authority alone may have received over $2 million.

Translated by Amarílis Anchieta