JBS’s Batista Brothers Arrested as Brazil Corruption Probes Spiral

September 14, 2017, 1:39 PM UTC

Two billionaire brothers, respectively the CEO and former chairman of Brazilian meat-packing giant JBS, have been arrested amid a corruption scandal that also involves the country’s president, Michel Temer.

To add insult to injury, the arrest comes after one of the brothers accidentally provided an incriminating tape to investigators.

JBS CEO Wesley Batista and his younger brother Joesley, the ex-chairman of the world’s biggest meat processor, had in May entered into a plea bargain with investigators over their admitted bribery of more than 1,800 politicians.

The deal would give them immunity from prosecution in the graft probe, which almost sunk Temer’s government. It turns out Joesley Batista recorded a conversation with the president in which they apparently discussed paying a politician for his silence.

Joesley Batista was supposed to provide evidence to prosecutors by last week, but his team messed up, sending the prosecutor’s office a tape they shouldn’t have. The tape they sent appeared to show that Joesley Batista was hiding information from the prosecutors.

A judge ordered the arrests of Joesley Batista and a former director of holding company J&F Investimentos, Ricardo Saud, on Friday. They turned themselves in on Sunday.

Then, on Wednesday, Brazilian federal police arrested Wesley Batista, this time on suspicion of insider trading. According to reports, both of the Batista brothers are suspected of having sold JBS shares and bought up foreign currency as they were negotiating the plea deal, in the knowledge that it would have a big impact on the relative value of both.

Indeed, news of the plea deal in May caused JBS’s stock and the Brazilian real to take 9.7% and 8.2% dives, respectively. The arrest warrant for insider trading covered both brothers.

Reuters reports that local media called yesterday “Super Wednesday” as, on top of Wesley Batista’s arrest, the Brazilian supreme court green-lit an ongoing corruption case against Temer; former president Luiz Inacio Lula da Silva was questioned by an anti-corruption prosecutor; and former Rio de Janeiro state governor Anthony Gartoinho was “arrested in a separate corruption probe in the midst of hosting a radio show.”

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