The controlling shareholder in Brazil’s JBS S.A., which in turn owns Greeley, CO-based JBS USA, is once again in federal custody in Brazil. Federal Police returned former JBS Chairman Joesley Batista to prison Friday morning, this time as part of their “Operation Carwash,” the 4-year old corruption probe involving the country’s politicians and businessmen.
Batista and his brother, Wesley Batista, until earlier this year, were being held in connection with “Operation Weak Flesh,” which was the investigation into the bribery of food safety inspectors. Joesley Batista implicated Brazilian President Michel Temer and many others in plea bargained testimony in April 2017. For possibly acting on insider information, and withholding information prosecutors wanted for the plea deal, the Batista brothers ended up behind bars the first time for about six months each.
Batista’s defense attorney says his client’s Friday arrest is “strange” because they’ve been now been fully cooperating with prosecutors.
For a time, it appeared as though the Batista brothers had a deal that would require them to pay large fines, but keep them out of jail. They agreed to each pay individual fines of $35 million in addition to a $3.3 billion fine to be paid by their J&F holding company. But it has not worked out that way.
Federal Police Friday morning arrested Lt. Gov. Minas Gerais Antonio Andrade, former agriculture minister Neri Geller, Congressman Joao Magalhaes and Batista over a 2014-15 bribery scheme that operated within the Ministry of Agriculture. While Batista was chairman, JBS S.A.reportedly made payments to politicians and public servants for approvals that would benefit the giant meat packing company.
Brazilian media reports the four arrested Friday will be charged with forming a criminal organization for active and passive corruption, obstruction of justice and money laundering.
Batista’s recorded conversations with the Brazilian President nearly brought down the Temer government and forced both of the Batista brothers to lower their public profiles in the publicly-traded JBS, S.A. Both remain on the JBS S.A. Board of Directors, but no longer hold the top jobs in the company.
It’s unclear how their previously plea bargained cooperation with the government will impact Batista’s new arrest. A total of 19 arrest warrants in five Brazilian states were executed on Friday.
JBS S.A.. is the world’s second largest food company in the world and the largest protein processor. It is a processor of beef, pork, lamb, chicken and value-added and convenience food products. JBS also sells hides, toiletries, cleaning, collagen, metal packaging, biodiesel, and other products.
JBS has more than 400 production units, 230 of them strictly related to the production of meat and convenience and value-added products worldwide. It employs over 235,000 employees and capacity to process 80 thousand heads of cattle per day, more than 14 million birds per day, 115 thousand hogs per day and 100 thousand hides per day.
JBS production and offices are centered in 22 countries on five continents, serving 350,000 customers in over 150 nations.
JBS S.A. entered the U.S. market with its 2007 purchase of Swift and Company. The JBS USA subsidiary has grown since through aggressive acquisitions. The company has delayed plans to take the subsidiary public while dealing with the Brazilian bribery scandal.
Since Oct. 4, JBS at Tolleson, AZ has been involved in a 6.5 million pound recall of beef products implicated in a Salmonella Newport outbreak that has sickened 120 people in 22 states.
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