Reuters: Brazil police formally accuse JBS Batista brothers of insider trading

Wesley Batista (R), chief executive of JBS S.A., the world’s largest beef producer, leaves the Federal Police headquarters to give a testimony in the Federal Court in Sao Paulo, Brazil September 13, 2017. REUTERS/Leonardo Benassatto

September 21, 2017

SAO PAULO (Reuters) – Brazil’s federal police on Thursday formally asked prosecutors to bring charges against brothers Wesley and Joesley Batista, the owners of meatpacker JBS SA (JBSS3.SA), for insider trading.

The Batista brothers saved as much as 138 million reais ($44 million) through allegedly illegal market dealings in May, police said.

The insider trading took place before the brothers signed a plea bargain deal with federal prosecutors, police said, in which they admitted to paying bribes to over 1,800 politicians in recent years to advance their own business interests.

Brazil’s President Michel Temer has been hit with three corruption charges based on the testimony of the Batistas and other JBS executives.

Under Brazilian law, a president can only be tried for a crime before the Supreme Court, and only if two-thirds of the lower house of Congress votes to allow the court to take up the case. In early August, lawmakers blocked the first of the three charges Temer faced, for allegedly taking bribes.

Congress is expected to vote in the coming weeks on charges of racketeering and obstruction of justice that were filed against Temer earlier this month.

On Sept. 13, police arrested Wesley Batista and also issued an arrest warrant for his younger brother, Joesley, for suspected insider trading. Joesley Batista had been in detention since Sept. 10 after recordings suggested he tried to take advantage of prosecutors during negotiations that led to the plea deal.

Brazilian law leaves it to prosecutors to lodge formal charges after police have concluded an investigation and given their official request that they be filed.