Brazilian federal police raided the home of Agriculture Minister Blairo Maggi in Brasili for his possible involvement in a bribery scandal that has caused shockwaves in the country’s agriculture industry.
Bloomberg reports there has not been a confirmed reason given by police for the raid of Maggi’s apartment on Sept. 14, but Reuters sources indicate it is related to the corruption scandal. This appears to be the latest development in several investigations into Brazilian government corruption involving the world's largest meat packing company, JBS.
On Sept. 13, JBS chief executive officer Wesley Batista was arrested for insider trading. His brother Joelsey, a fellow major shareholder in JBS, gave himself up to authorities on Sept. 10 because he had withheld information from prosecutors during plea deal in May. The plea deal is pending after these recent developments.
In the plea deal the brothers admitted to bribing approximately 1,900 politicians, but prior to the meeting they made a number of currency trades that benefited themselves. Police are alleging the Batista brothers saved $44 million by making trades in advance of the plea deal. The billionaire brothers’ family controls 42% of JBS’s shares.
Stock prices for JBS SA plummeted by 9.7% following the announcement of the plea deal, Brazil’s currency saw its largest drop since 1999 when the real fell 8.2%. JBS SA’s stock price was at 8.59 Brazilian real on Sept. 14, up 3.87% from the previous day.
Following the arrest of Wesley it was reported that JBS had suspended cattle buying at some packing plants in Brazil. A board meeting was held on Sept. 13 but no discussions were had on a succession plan for the CEO position.
The corruption scandal goes all the way to top of politics in Brazil with President Michel Temer possibly facing charges for his participation.