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Brazilian government officials cited in the Paradise Papers

. Nov 06, 2017
Paradise Papers Finance Minister Henrique Meirelles Finance Minister Henrique Meirelles. Photo: José Cruz/ABr
Paradise Papers Finance Minister Henrique Meirelles

Finance Minister Henrique Meirelles. Photo: José Cruz/ABr

On Sunday, dozens of media outlets across the globe began to publish a series of articles based on a massive leak of documents from Appleby, a Bermuda-based law firm specialized in offshore accounts. The files – 13.4 million of them – reveal a vast financial network used by wealthy individuals to hide money from their governments. The list of this network’s beneficiaries include members of the U.S. government, the British royal family … and Michel Temer’s administration.

Finance Minister Henrique Meirelles and Blairo Maggi, Brazil’s Minister of Agriculture, are beneficiaries of companies based in tax havens. Meirelles created a foundation in Bermuda in 2002, while Maggi created a trust in the Cayman Islands seven years ago. They both claim to have done nothing illegal.

To be fair, Brazilian legislation says that there is nothing wrong with keeping money in tax havens, as long as offshore accounts are declared to revenue authorities. Plus, Brazilian legislation regarding offshore trusts and foundations is practically non-existent. As long as the money is declared, no crime is committed.

Henrique Meirelles and his offshore foundation

Meirelles’ foundation, The Sabedoria Trust, was created on December 23, 2002, <a href="https://www.poder360.com.br/paradise-papers/ministro-henrique-meirelles-usa-trust-em-paraiso-fiscal-para-gerir-heranca/">with a $10,000 deposit</a>. That was one week before Meirelles took office as the head of Brazil’s Central Bank in January 2003.</p> <p>The minister presented journalists with a copy of his tax returns proving that he did indeed declare his Bermuda-based company to the authorities. According to him, the foundation was created for “charitable purposes” since it is meant to inherit a portion of Meirelles’ estate upon his death, which will then be used to support education-related initiatives. Meirelles also declared in a statement that thus far, the foundation has not received any assets.</p> <p>Meirelles’ offshore deals were the object of scrutiny in July, when BuzzFeed published information about his <a href="https://www.buzzfeed.com/filipecoutinho/meirelles-consultoria-217-milhoes?utm_term=.epdv2oaR4#.gly7oMvVx">profits as a consultant for private corporations</a>. Three months prior to becoming Finance Minister in May 2016, he received 167 million BRL in offshore accounts from big companies, including J&amp;F, which controls the JBS meatpacking group (you might remember JBS from multiple corruption scandals).</p> <p>At the time, Meirelles said that the money was received outside of Brazil because his clients are global companies.</p> <h3>Blairo Maggi’s trust in the Cayman Islands</h3> <p><div id="attachment_1064" style="width: 2018px" class="wp-caption alignnone"><img aria-describedby="caption-attachment-1064" class="size-full wp-image-1064" src="https://brazilian.report/wp-content/uploads/2017/11/Paradise-Papers-Minister-Agriculture-Blairo-Maggi.jpg" alt="Paradise Papers Minister Agriculture Blairo Maggi" width="2008" height="1036" srcset="https://brazilian.report/wp-content/uploads/2017/11/Paradise-Papers-Minister-Agriculture-Blairo-Maggi.jpg 2008w, https://brazilian.report/wp-content/uploads/2017/11/Paradise-Papers-Minister-Agriculture-Blairo-Maggi-300x155.jpg 300w, https://brazilian.report/wp-content/uploads/2017/11/Paradise-Papers-Minister-Agriculture-Blairo-Maggi-768x396.jpg 768w, https://brazilian.report/wp-content/uploads/2017/11/Paradise-Papers-Minister-Agriculture-Blairo-Maggi-1024x528.jpg 1024w" sizes="(max-width: 2008px) 100vw, 2008px" /><p id="caption-attachment-1064" class="wp-caption-text">Minister Blairo Maggi. Photo: Fabio Pozzebom/ABr</p></div></p> <p>Brazil’s Minister of Agriculture, Blairo Maggi, is the “beneficial owner” of a company that was opened in the Cayman Islands back in 2010. That company was a joint venture between one of Maggi’s companies and the Dutch giant food conglomerate Louis Dreyfus. The Louis Dreyfus Company is a large food company based in Amsterdam.</p> <p>In 2009, Louis Dreyfus Commodities Brazil S.A. and Amaggi Exportação e Importação Ltda came to an agreement on creating a Brazilian joint venture, with the purpose of operating in the grain market in the northeastern states of Bahia, Maranhão, Piauí, and Tocantins. The deal resulted in Amaggi &amp; LD Commodities Ltda, created in January 2010.</p> <p>That same year, the new company opened a trust in the Cayman Islands. Curiously, though, the listed beneficial owners are all members of the Maggi family. Not one is from Louis Dreyfus. Maggi claims that he never received money from the trust, and therefore was not required to declare it.</p> <p>This is not the first time that Maggi’s name has been tied to suspicious financial operations. In September, he was linked to a corruption ring. The Federal Police raided his home as part of a corruption investigation related to his time as the governor of Mato Grosso (2003-2010).</p> <p>The Maggi administration is suspected of having enforced a scheme of monthly bribes paid to state lawmakers in exchange for political support. Maggi&#8217;s former deputy and successor in office, Silval Barbosa, signed a plea deal with investigators. He has accused Maggi of leading the corruption ring and attempting to bribe witnesses.</p> <h3>About Paradise Papers</h3> <p>The German newspaper Süddeutsche Zeitung acquired 13.4 million documents from Appleby and its spin-off company, Estera. The newspaper shared the files with the International Consortium of Investigative Journalists (ICIJ) and news organizations around the world. A total of 382 journalists from 67 countries – working for 96 media companies – took part in the investigation.</p> <p>The journalists have identified 24,996 juridical persons, among them companies, trusts, and foundations. Of the people who listed as beneficiaries of these juridical persons, 617 have addresses in Brazil. The U.S. leads the lists of general people involved, with 31,180.</p> <p>Appleby claims to be “one of the world’s largest providers of offshore legal services.” Once again, having offshore accounts is not illegal. However, they can be used to hide money from authorities – and hidden money often comes from illegal activities, including corruption.</p> <p>Earlier this year, Süddeutsche Zeitung and ICIJ won a Pulitzer Prize for their investigation into the so-called Panama Papers, another investigation based on millions of leaked documents.</p> <p><img class="alignnone size-full wp-image-1066" src="https://brazilian.report/wp-content/uploads/2017/11/Paradise-Papers-Project-Page-Smaller-1280x427.jpg" alt="Paradise Papers Project " width="1280" height="427" srcset="https://brazilian.report/wp-content/uploads/2017/11/Paradise-Papers-Project-Page-Smaller-1280x427.jpg 1280w, https://brazilian.report/wp-content/uploads/2017/11/Paradise-Papers-Project-Page-Smaller-1280x427-300x100.jpg 300w, https://brazilian.report/wp-content/uploads/2017/11/Paradise-Papers-Project-Page-Smaller-1280x427-768x256.jpg 768w, https://brazilian.report/wp-content/uploads/2017/11/Paradise-Papers-Project-Page-Smaller-1280x427-1024x342.jpg 1024w" sizes="(max-width: 1280px) 100vw, 1280px" />

 
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