JBS chairman accused of financial crimes

By Oscar Rousseau

- Last updated on GMT

JBS chairman Joesley Batista charged with “crimes against the financial system”
JBS chairman Joesley Batista charged with “crimes against the financial system”

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Shares in the Brazilian meat company JBS have hit a 15-month low, coinciding with reports that senior figures, including the chairman Joesley Batista, have been accused of financial crimes regarding loan payments made to related companies in 2011.

Nine people connected to the conglomerate JBS or the Brazilian company Banco Rural SA have been accused of financial misconduct, according to statement on Tuesday 26 January from federal prosecutors in São Paulo.

Among the high level executives accused of financial misconduct is the company’s chairman Joesley Batista, who has been charged with “crimes against the financial system​”.

It was alleged that, on 22 December 2011, two JBS companies received a total of R$80 million ($20m) in loan payments from Banco Rural SA, one day after opening current accounts. After discounted taxes and fees, which left the total amount at R$79.3 million ($19.5), these loans were immediately passed on to two companies – J&F and Flora – which have links to JBS and Banco Rural.

Four days after later, Trapeze SA – also linked to JBS – received a loan of R$80m ($20m), claimed federal prosecutors in Brazil.

Known as a ‘lead change’, federal prosecutors alleged that this circular payment method broke Brazilian business laws, which prohibit a company passing on loans to subsidiaries.

After news of the allegations broke on 26 January, shares in JBS nose-dived and had fallen by 8% (at the time of writing). This marks a 15-month low in the share price of the multinational conglomerate, which describes itself as “the largest meat processing company in the world​”.
JBS was not able to provide comment.

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