Brazil opens new probes into JBS’s insider trading
SAO PAULO: Brazil’s securities regulator said it launched four new probes against meatpacker JBS SA and other companies controlled by J&F Investimentos on Friday to investigate suspicious trades made before markets were rattled by the revelation of a plea deal by the company’s top executives.
In a statement late on Friday, CVM said it is investigating “signs of possible insider trading” of foreign exchange futures, derivatives and JBS stock ordered by meatpacker JBS SA, Banco Original SA and FB Participações SA.
A first investigation had been launched on Thursday, the regulator said. The Batista brothers, Joesley and Wesley, controlling shareholders in JBS, claim President Michel Temer received 15 million reais (£3.53 million) in bribes from the world’s largest meat processor, according to plea-bargain testimony. Temer has denied any wrongdoing and on Thursday refused to resign. The real fell 8 per cent against the US currency on Thursday, sustaining the largest losses since the country devalued its currency in 1999.
The real pared losses on Friday, gaining 3 per cent against the dollar.
Valor Econômico reported on Friday that companies owned by the Batista brothers bought over $1 billion in US dollar contracts in the local market hours before the plea deal news broke.
JBS said in a statement on Friday any trades made this week were consistent with the company’s strategy of hedging its large dollardenominated debt.
The company said the recent currency swings could have caused more than 1 billion reais in losses.
The regulator is also examining the sale of shares in the company by its controlling shareholders and subsequent acquisitions by the company´s treasury.