Banco do Brasil managers targeted in $48 million money laundering probe
30 Sep 2019

Brazilian police on Friday raided the homes of Banco do Brasil (BBAS3.SA) managers suspected of involvement in a 200 million reais ($48 million) money laundering scheme, police said, the latest phase of Brazil’s massive Car Wash corruption scandal. According to the Federal Public Prosecutors office, police are investigating allegations that managers at three branches of the state-controlled bank laundered more than 200 million reais between 2011 and 2014, the office said.

Banco do Brasil said in a statement it has launched internal investigations that may result in dismissing suspected employees, adding it is collaborating with authorities.

The bank’s shares opened down 1% on news of the probe, but recovered quickly to advance 0.7%.

The money was used to pay bribes by engineering and construction firms for contracts with state-run oil company Petroleo Brasileiro (PETR4.SA) in the vast kickbacks and political bribery scheme uncovered in 2014, the office said. When informed of the allegations, Banco do Brasil conducted internal investigations that resulted in further evidence being sent to the authorities, according to the prosecutors.

They said the suspects, in return for bribes, allegedly turned off the money laundering detection system for some transactions, blocking the information channel to the Council for Financial Activities Control (COAF), a key tool for flagging suspicious funds moving through the banking system.

By Jamie McGeever, Anthony Boadle and Pedro Fonseca, Reuters, 27 September 2019

Read more at Reuters

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