The Hamilton Spectator

Tycoon arrested in meat packing scandal

Brazilian CEO at centre of insider trading investigat­ion

- SARAH DILORENZO AND PETER PRENGAMAN

SAO PAULO — Brazilian police on Wednesday arrested the CEO of the world’s largest meat packer for allegedly using their own plea bargains to gain an advantage in financial markets.

Wesley Batista was arrested in Sao Paulo. Batista and his brother Joesley, the former chair of JBS, have both entered agreements with prosecutor­s in which they testified that JBS paid bribes to scores of politician­s, including President Michel Temer. Temer denies wrongdoing.

The Batistas have been at the centre of Brazil’s near-operatic corruption investigat­ion in recent weeks — a drama outlined by the plea-bargain singing of many witnesses. The sprawling probe has uncovered a scheme in which several companies paid millions of dollars in bribes to politician­s.

The investigat­ion, the largest in Brazil’s history, has implicated several former presidents. Ex-president Luiz Inacio Lula da Silva, for instance, has already been convicted of corruption in one case. Da Silva arrived at a court in the southeaste­rn city of Curitiba on Wednesday to testify in another.

Executives from JBS have provided evidence for some of the most serious allegation­s, including claims that Temer arranged to receive millions in payouts in exchange for helping the meat packer. But in recent days, prosecutor­s have questioned whether Joesley Bastista and other executives may have withheld some informatio­n, violating their plea deals.

Wednesday’s accusation­s focused on the company’s activity in the weeks before their plea deals became public.

Police investigat­or Victor Hugo Rodrigues Alves said the Batistas knew that the plea bargains would affect stock prices and cause the Brazilian real to weaken against the U.S. dollar and used that to their advantage.

A warrant for Joesley Batista’s arrest was also issued, but the executive has been in custody since Sunday following the questions about his plea testimony.

Between late April and mid-May, while negotiatin­g their plea bargains, the brothers made large purchases of dollars on the futures markets, Rodrigues Alves said. During that period, their holding company also sold hundreds of millions of dollars in JBS shares.

“The victims are not just JBS shareholde­rs,” said Rodrigues Alves. “In a large context, the country is a victim, as the crimes shook the confidence of the market.”

Over the course of around 10 days in May, as word began leaking out that the brothers were considerin­g plea bargains that included damning accusation­s, JBS shares plummeted, losing nearly half of their value.

Pierpaolo Cruz Bottini, a lawyer for the Batista brothers, called the arrest “unjust, absurd and regrettabl­e.” He said his clients had co-operated with authoritie­s and suggested they were being targeted by some within the government for having reached plea deals.

 ?? DENIS FERREIRA, THE ASSOCIATED PRESS ?? Former Brazilian president Luiz Inacio Lula da Silva, centre, has already been convicted of corruption in one case. Da Silva arrived at a court on Wednesday to testify in another case.
DENIS FERREIRA, THE ASSOCIATED PRESS Former Brazilian president Luiz Inacio Lula da Silva, centre, has already been convicted of corruption in one case. Da Silva arrived at a court on Wednesday to testify in another case.

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