Brazil's Batista Clan: A Short Guide to an Empire Built on Beef

While Brazil’s enormous Carwash corruption scandal has gained international attention over the past few years, plenty of other graft investigations have been under way in the shadows. Six probes involve companies controlled by the Batista family, which built an empire out of beef, pulp and banking. Here’s a quick summary of the family, and their businesses, which are now at the center of the latest political crisis to engulf the country.

The Family

• José Batista Sobrinho. Zé Mineiro, as the family patriarch is also known, founded the the company that became known as JBS (the name takes his initials). Working as a butcher, he settled in Brasilia in 1957, just as President Juscelino Kubitschek implemented his “fifty years in five” plan to fast-track building of the nation’s new capital. Batista helped supply meat for the construction workers and later acquired his first meatpacking plant, the first in a series of acquisitions that transformed his business into the world’s largest meatpacker over the next several decades. Now 84, Sobrinho is still involved in the family business. Batista has three sons and three daughters. Five of the children each have an equal interest in J&F Investimentos, the family holding company.
• José Batista Junior. The oldest of the three brothers began working with his father when he was 15 years old and took over the running of the JBS slaughterhouse -- the family’s main business -- in 1980, when he was just 20. He led the company until 2007, when JBS sold shares in a public offering. At that time, Jose Jr. became a member of the board, a position he held until 2013. That same year, he sold all his shares in J&F to his brothers and left the family business to focus on politics. He ran an unsuccessful bid for governor in his home state of Goias and was later kicked out of the PMDB party because of political disagreements.
• Wesley Batista: The second-oldest son also began working with his father at 15, when he took over the operations of a slaughterhouse in Goias state. He became global CEO of JBS in 2011. Before that, he served at the helm of the meatpacker’s U.S. business, leading turnarounds at Swift and Pilgrim’s Pride after they were acquired by JBS. Wesley, now 47, is seen as a details guy who is quieter than his brothers and takes a greater interest in the company’s finances. Last year, he was forced to briefly step down as CEO of JBS following a court order connected to a probe into pension-fund fraud.
• Joesley Batista: The youngest brother was JBS’s CEO between 2007 and 2011, overseeing a period that marked the company’s fastest-ever expansion and its transformation into the world’s largest meatpacker. While Wesley is considered a numbers man, Joesley is seen as the relationship guy. He’s made regular appearances in Brazil’s social columns, partly thanks to a lavish wedding to a Brazilian television journalist. In business, Joesley has tapped his social skills to make acquisitions of companies including Swift and Pilgrim’s Pride. Joesley, 45, is JBS’s chairman. Last year he was ordered by a federal court judge to step down as chairman of J&F amid an investigation into investments made by Brazilian pension funds. In March, he recorded a conversation with Brazil’s President Michel Temer approving a bribe, a local newspaper reported Wednesday, triggering a new political crisis in the country.
• Valeria, Vanessa and Viviane Batista: The three sisters, all of whom are J&F shareholders, have largely stayed out of the spotlight and don’t hold any executive roles in the family businesses.

The Business

• J&F Investimentos. The family’s holding company is Brazil’s largest private conglomerate, according to its website, controlling companies with a combined revenue of 174 billion reais ($52 billion) in 2015. Under its umbrella are a range of businesses:
• JBS. The meatpacker made news in 2015 when it bet big on Brazil’s currency collapse and made more from the hedging operation than all of its beef, poultry and pork operations combined.
• Eldorado Brasil Celulose. The pulp producer is being investigated by federal police in a fraud case involving pension funds.
• Banco Original. J&F’s bank was founded in 2008 with a mission to finance agribusiness. It had 8.7 billion reais in assets under management at the end of 2016. The lender is being investigated for alleged irregular transactions with Banco Rural.
• Flora. Founded in 1980, the company that takes its name from Jose Batista Sobrinho’s wife is currently a market leader in the production and sale of cleaning products and cosmetics in Brazil, according to the company’s website. It owns 17 brands.
• Vigor. One of the country’s major dairy companies, Vigor owns 14 factories in Brazil.
• Alpargatas. The maker of Havaianas flip-flops is Latin America’s largest shoe producer, according to the company’s website. J&F’s acquisition of the shoemaker in 2015 was financed by a loan that’s being investigated by Brazil’s audit court.
• Canal Rural: The Brazilian television channel focuses on the business of agriculture. J&F bought this unit in 2013 from a regional group in Brazil.

The Allegations

• Jan. 26, 2016: Brazil’s public prosecutor accused J&F executives including Joesley Batista of financial crimes involving a series of loans made to related companies. Federal prosecutors alleged that in 2011, companies in the JBS business group borrowed 80 million reais from Banco Rural and then J&F’s banking unit lent the same amount to an affiliate of Banco Rural.
• July 1, 2016: Eldorado Brasil Celulose, which shares a headquarters with JBS, was searched as part of an investigation derived from Carwash and related to bribes payed to Brazil’s former house speaker Eduardo Cunha.
• Sept. 5, 2016: Eldorado and J&F’s offices were again raided by police, this time as part of an investigation into questionable investments by pension funds.
• Jan. 13, 2017: J&F is among companies investigated in a probe involving Brazil’s Caixa Economica Federal bank credit operations.
• March 17, 2017: Authorities in Brazil said on March 17 they’re investigating evidence that employees of JBS and at least 20 other companies bribed government officials to approve the sale of tainted meat. While bans on beef exports from Brazil were short-lived and the allegations against JBS involved only a very minor part of its operations, the company’s stock tumbled 11 percent by the day’s end. First-quarter earnings were also hurt.
• May 12, 2017: Brazilian investigators got permission from a judge to search Joesley and Wesley’s homes for evidence of fraud and irregularities in investments that state bank BNDES made in JBS. The transactions in question led to about 1.2 billion reais of losses for the bank.