A survey on a capital laundering program of several billion dollars (Primeiro Comando Da Capital – PCC), a money laundering scheme involving chemical imports, fuel and investment funds distributed reforms in the Brazil digital banking sector. But the gaps in the application mean that the gang is likely to continue to exploit digital platforms to whiten the benefits.
Hidden carbon operation (Carbono Oculto) was the greatest response from the government to the crime organized in Brazil, according to To President Luiz Inácio Lula da Silva. From 2023, he brought together Federal Brazil Revenue Revenue Service (Receita Federal) and the Special Action Group of São Paulo for the abolition of the organized crime (Grupo de Atuação Especial of Repriresão Ao Crime Organization of São Paulo – Gaeco) and involved around 1,400 security officers and the execution of more than 400 judicial orders.
The gain was the detection of a PCC diet implying Methanol illegal import to make a eyeshadow in fuel and money laundering via investment funds and financial technologies – companies that offer digital and financial banking services.
PCC members imported Methanol using money from gang -related companies and listing false buyers on receipts, the survey revealed. Then, they sent it to fuel mixers who mixed methanol in petrol before transmitting it to distributors and service stations that sold the falsified fuel to customers. The profits were then transferred to the CCP using fintechs. Finally, illicit money has been reinvested in investment funds and other companies.
The use of fintechs in the program has made it difficult to monitor transactions, as they are not classified as financial institutions and at that time did not have to follow the same regulations as traditional banks. The investment funds then acted as the entry point of money not found in the legal economy.
The operation revealed that the PCC had Assets of around 30 billion reais (more than $ 5.5 billion) have invested in more than 40 funds in one of the most important financial centers in Brazil in São Paulo. Among them, there were funds operated by one of the largest investment management companies in the country. While some of the funds were exclusive, the PCC as a single action, others saw CCC money mixed with investments by regular account holders.
“There is a real overlap between the gang and at least some of the management companies involved. He created fronts and penetrated parts of the financial market,” Crime João Paulo Gabriel, Gaeco police chief, told Insight who was part of the investigation.
The regime involved approximately 1,000 service stations across the country, while the CCP reinvested the bleached product to buy goods such as a port terminal and 1,600 trucks to transport fuel.
After the operation, the Minister of Finance of Brazil Fernando Haddad announcement Changes in fintech regulations, reclassifying them as financial institutions to try to close the money laundering used by the PCC in the case. On August 29, Fintech began to follow the same rules as traditional banks, such as the reporting of suspicious transactions to the Brazil financial activity control council (ATIVIDEADES FINANCEIRAIRAS – COAF) and subject to increased monitoring by federal income.
An analysis of insightful crime
The new Brazil regulations for fintechs represent an important first step in the fight against money laundering through digital banks, which have been used to launder 52 billion reais (around 9.5 billion dollars) in the past four years, according to To the Minister of Finance Fernando Haddad. However, the low monitoring and application of the anti-flowage mechanisms of Brazil mean that the CPC and other organized crime groups will likely continue to use fintech as a parallel banking system.
The new regulations will end the finches in accordance with the rules governing must Report suspicious operations to CoAF. The authorities hope that this will highlight this key element of what has become a shaded economy exploited by the PCC and other criminal networks. “We hope that these regulations will provide services in terms of more control over transactions and will allow the State to regain control of the country's economy. Because, as far as we can see, there is a parallel state now, with a parastatic economic arm,” said Ivana David, judge at the Court of Justice of São Paulo, Insight Crime.
However, even traditional financial institutions can easily point out false values to hide illicit operations, as there is no direct external surveillance of your customer's knowledge (KYC) and anti-flask (AML) that companies should use to report irregular transactions. And although the reform brings fintechs in the same regulatory framework as traditional banks, these platforms still have a long way to go to meet the regulatory standards of these long -standing institutions, and their implementation of new requirements is therefore likely to be low.
“The criminals exploit the regulations that exist but which are not precisely applied to whiten illegal money,” said David.
See also: The Brazil PCC stops in the game of municipal contracts
In addition, in many cases, the CCP can easily handle financial reports, as it has members working within companies and financial institutions. This was the case in the falsified fuel whitening system, where the alleged member of the PCC Mohamad Hussein Mourad, alias “first”, was a partner of two of the companies involved and Stands accused to use its position to coordinate money laundering.
“A network of service providers for crime has taken shape (within financial institutions), and in some cases, we find that they really belong to the criminal organization itself,” said police chief Gabriel in Insight Crime.
In addition, even if the Fintech reports suspicious transactions to CoAF, there is a strong possibility that no other action will be taken, because only about 3% of these reports lead to an investigation, according to Guilherme Gueiros, a criminal lawyer at Pice Blum, Bruno Adugados, who specializes in Cybercrime.
“Today, CoAF does not have the structure, the financial and human resources to manage the work they are responsible for doing, because there is a huge volume of suspicious operations that they must analyze daily,” he said. “I believe that the strengthening of the COAF is fundamental to increase efficiency. The new president of the agency, Ricardo Saadi, faces an important challenge, but also brings the skills necessary to stimulate significant changes. ”
Star image: real real Brazilians in front of a graph of the financial market. Source: GSA
