Rio Parapolitics: “Batman To Be Subdued By 30-Second Radio Spots”

Bat macumba oba, 2006: The Batman shield marks militia-”protected” homes and businesses in Rio’s Western District — and appears in the campaign advertising of two local candidates. Source: TV Record Rio (as I recall, not sure)

TRE prepara campanha contra ‘currais eleitorais’ no Rio: Disturbed by reports that drug traffickers and armed paramilitary groups have created “political corrals” in Rio de Janeiro — “vote Quimby or my friend here will blow your head off” — the state elections tribunal decides to take drastic measures.

It decides to run an advertising campaign.

The report is from G1/Globo.

O Tribunal Regional Eleitoral do Rio (TRE-RJ) informou que vai realizar a partir de agosto uma campanha publicitária na mídia a fim de estimular a denúncia da formação de currais eleitorais.

The regional elections tribunal for Rio de Janeiro (TRE-RJ) reports that it will conduct an advertising campaign in the media starting in August to encourage citizens to denounce the formation of “electoral corrals.”

O setor de inteligência da Polícia Federal já foi acionado para combater a prática ilegal de grupos de milícias e traficantes que chegam a impedir a entrada de candidatos concorrentes nas comunidades.

The intelligence division of the Federal Police has already been invited in to combat the illegal practice in which militias and drug traffickers prevent competing candidates from campaigning in the communities they control.

Dantas’ Inferno: Opportunity For Oversight?

Banco Central inicia fiscalização no Opportunity: Opportunity has central bankers going through its transactions “with a fine-tooth comb.” The report is from Alex Ribeiro of Valor Econômico.

BRASÍLIA – O Banco Central (BC) terá apenas um papel secundário nas apurações do caso Opportunity porque os indícios são de que os supostos crimes apurados pela Polícia Federal ocorreram fora do sistema financeiro. Daniel Dantas não faz parte do grupo de controle acionário ou do corpo dirigente do Banco Opportunity e, para o BC, é apenas um empresário e um gestor de recursos de terceiros.

The BC will play only a secondary role in the Opportunity investigations because indications are that the alleged crimes probed by the federal police were not committed in the Brazilian financial system. Dantas is not part of the controlling group of shareholders or executive management of Opportunity, and is, in the view of the BC, a mere asset manager for third parties.

Há processos administrativos dentro do BC que apuram supostas irregularidades cambiais. O Opportunity fez remessas ao exterior em nome de clientes que, nas fichas cadastrais, não tinham patrimônio suficiente para movimentar altas somas. O banco sustenta que conhecia os clientes e que as transações eram compatíveis com o perfil econômico. Esses processos, provavelmente, vão resultar em penas leves aos administradores do banco, como multas.

Investigations into irregularity foreign exchange transactions are ongoing inside the BC. Opportunity transferred funds out of the country in the name of clients who, on their registration cards, did not claim sufficient assets to explain the sums involved. The bank maintains it knew its clients well [KYC] and that the transactions were compatible with clients’ economic profile. These proceedings will likely result in light penalties for bank administrators, such as fines.

Brazil’s Other Bad-Boy Banker With Knowledge of Bodies Buried

Apologia pro vita sua and “witness to history” read of the week. A new edition hit the shelves as soon as the banker’s arrest in Monaco hit the news.

Relatório reservado nº3422 17/07/2008: Snippets from the highest-quality rumor mill available here today include the imminent return of Salvatore Cacciola, along with alleged Rupert Murdoch sightings on the calçadão in Rio.

Na cúpula do Planalto, aguarda-se com ansiedade a chegada de Salvatore Cacciola. Os planaltinos estão excitados com o arrolamento de nomes até então não mencionados, como o do ex-ministro Pedro Malan. Não é difícil antever aonde quer se chegar.

High-ranking officials of the federal executive are anxiously awaiting the return of Salvatore Cacciola. The palace guard are excited about the prospect of names being named that have never been mentioned before, such as that of former Treasury minister Pedro Malan. It is not difficult to see where they hope to get with this.

It’s true. If there is a war being waged in the press here over who can be beaten most soundly over the head with the Dantas case — current goverment, or the previous one, both of which were apparently lobbied heavily and with great success by the big-eared banker — Cacciola has been in deep freeze for a decade. Unfrozen, he can draw attention to the opening of unmarked graves.

That is why I was thinking you could liken him to Encino Man, a dippy comedy from a decade or so back in which two stoner teenagers discover a frozen caveman in excavations for their swimming pool, and revive him.

Never mind.

The ex-banker fled Brazil to avoid serving time on a conviction related to a bank bailout that occurred during the devaluation of the currency in 1998 — about the time Dantas began his career in what is known by local wags as “privataria” — as a “privateer of privatization,” I suppose you could translate.

“CVM: Short-Tempered With Bermudan Brass?”

CVM: “The Securities Commission.” Closely comparable to the U.S. SEC, but it’s a something of a mistake to think it’s the U.S. regulator’s doppelganger.

CVM abre processos contra Dufry, Agrenco e Laep (Valor): A follow-up note to

• “CVM Builds Barriers to BDRs”

SÃO PAULO – A Comissão de Valores Mobiliários (CVM) abriu processos para investigar os acontecimentos recentes envolvendo Agrenco, Laep (Parmalat) e Dufry South America, todas com sede nas Bermudas e recibos de ações (BDR), listados na Bovespa. Os procedimentos correm sob sigilo.

Brazil’s securities regulator, the CVM, is investigating recent incidents involving Agrenco, LAEP (Parmalat) and Durfy South America, all domiciled in Bermuda and listed on the Bovespa through Brazilian Depositary Receipts (BDRs). The proceedings are confidential.

Not anymore, they aren’t.

No caso da Agrenco, já são oito processos, sendo seis por conta de reclamações de investidores. Os outros dois foram abertos pela Gerência de Registros e pela Superintendência de Relações com Empresas (SEP) da autarquia, em razão de ” irregularidade detectada ” . O primeiro processo é do dia 23 de junho, a segunda-feira após a prisão dos executivos da companhia por suspeitas de crimes contra o sistema financeiro em operação da Polícia Federal.

In the case of Agrenco, there are eight proceedings, six of them based on complaints lodged by investors. The other two were opened by the agency’s securities registry department and the SEP, the superintendent of corporate relations. The first proceeding was filed on June 23, the Monday after the arrest of company executives by federal police on suspicion of crimes against the financial system.

Accounting fraud in the company’s financial statements, basically, as I understand the accusations.

I Learn a New Word

Funny it should be the advanced math majors who get it: that words really o matter.

I am about to start doing some stringer work for a financial news agency — I won’t say which, since the contract is not signed yet — and I find that there is a term in the very thorough instruction manual they send me that I am not familiar with.

I find it in this excellent Cisco Systems investor relations glossary.

Earnout
A contractual provision stating that the seller of a business is to obtain additional future compensation based on the business achieving certain future financial goals.

Dantas’ Inferno: “Central Bank Knocks Opportunity Laundry Controls”

"Why DD Scares So Many People." Época (Globo)

BC suspeita de lavagem de dinheiro no banco de Dantas: The Brazilian Central Bank has an ongoing investigation into the alleged inadequacy of money-laundering controls at Daniel Dantas’ Opportunity Bank, the Estadão reports today.

O Banco Central está processando o banco Opportunity, de Daniel Dantas, por suspeita de lavagem de dinheiro. E os indícios da prática criminosa foram levantados pelo próprio BC, em uma fiscalização feita em 2007 pelo Departamento de Combate a Ilícitos Financeiros e Supervisão de Câmbio e Capitais Internacionais (Decic). O relatório do Decic concluiu que o Banco Opportunity “expõe seus produtos e serviços à lavagem de dinheiro” porque “não tem controle” das operações de seus correntistas.

… Inications of criminal activity were discovered by the central bank itself during a 2007 audit by DECIC, the financial crimes and currency exchange and international capital oversight division of the bank.

Wow, never heard of that. COAF is the local equivalent to FinCEN in the U.S., in terms of financial crime investigation.

The DECIC report found that Opportunity “exposes its products and services to money laundering” because “it lacks controls” over transactions by its account holders.

“Anglo-MMX M&A Is (Is Not) a Done Deal”

Nova MMX e Iron X serão negociadas na Bolsa este mês: Spin-offs of Brazilian mining concern MMX, created to facilitate the purchase of the parent company’s assets by Anglo American, will debut on the São Paulo Stock Exchange this month, reports Exame (Editora Abril), which is basically just cribbing the rewriting of the press release by the Agência Estado.

A report yesterday from the Folha de S. Paulo, however, indicated that Anglo American will await the outcome of a police investigation involving MMX — alleged favoritism in a railroad concession in the northern state of Amapá — before moving to take control.

Typical Brazilian Rashomon scenario: dueling press releases asserting that

1. A risk exists
2. No risk exists

Both sides of the controversy engaging in ignoratio elenchi — “ignoring the existence of a counterargument.” I translate, draft-quality:

“Agrenco BDRs Return to Trading”

Agrenco depositary receipts up 20% as trading resumes

• BDRs da Agrenco voltam a ser negociados (O Globo). See also
• Agrenco Shares Still Suspended; CVM Demands Explanation of Noble Offer
• “CVM Builds Barriers to BDRs”
• Will Dreyfus Bail Out Agrenco? Or Just Bail?
• Dreyfus on Agrenco Takeover: “We Won’t Be Ready ‘Til We’re Ready”
• Agrenco-LDC: Disclosure of a Material Non-Event?

A negociação com os ativos da empresa estava suspensa desde a quinta-feira passada, dia 10 de julho, por determinação da própria Bovespa, que aguardava esclarecimentos sobre as propostas de aporte de capital que a companhia já recebeu de três interessados.

Trading in the shares of the company had been suspended since last Thursday, July 10, by determination of the Bovespa, which was waiting for further details of a proposed infusion of capital from three interested parties.

Vale lembrar que as ações da companhia, quem tem sede em Bermudas, quase viraram pó depois que os controladores foram presos em operação da Polícia Federal (PF) realizada em junho.

It should be recalled that shares in the company’, which is domiciled in Bermuda, lost nearly all their value when its controlling shareholders were arrest in a federal police operation in June.