Federal police have tightened their grip on suspects in a billion-dollar fraud case that harmed retirees and pensioners through unjustified deductions. On Thursday, the former head of the institute, Alessandro Stefanotto, who was fired after the scandal came to light, was arrested. He is accused of working to release liabilities for the National Union of Agricultural Workers after a dissenting opinion from the INSE Prosecutor’s Office and receiving bribes from one of the entities investigated (his defense considered the arrest “completely illegal” and claimed that Stefanotto cooperated with the investigations).
- Editorial: Operation PF highlights negligence in INSS management
Operation PF, in partnership with the Federal Comptroller General (CGU), issued ten arrest warrants and 63 search and seizure warrants in 14 states and the Federal District. Among those targeted were José Carlos Oliveira, Minister of Labor and Social Security in Bolsonaro’s government (he will have to wear an electronic ankle bracelet), federal lawmaker Euclides Petersen (Republicanos-MG) and state lawmaker from Maranhão Edson Araujo (PSB). Crimes of entering false data into official systems, creating a criminal organization, social security fraud, active and passive corruption, as well as acts of concealment and vandalism of property are investigated. Minister Andre Mendonça, rapporteur of the case at the Supreme Court, approved these measures.
- Editorial: Combating fraud in INSS should be a state measure
Although the federal government began compensating the victims in July, compensation does not put an end to the crime committed. It is necessary to identify all those responsible for the fraud and understand how the unauthorized deductions were approved by INSS. Many retirees didn’t even realize they were being ripped off, as monthly deductibles were relatively low.
Permits submitted by unions were generally fraudulent. According to the CGU, 70% of the 29 entities authorized to work with discounts did not submit the required documentation to INSS. The robbery occurred between 2019 and 2024, but it exploded under the current government. INSS estimated the return of unjustified deductions at R$2.5 billion. There were warnings from regulatory bodies about unusual increases in union revenues, but they were ignored. The accident led to the downfall of the then Minister of Social Security, Carros Lupi.
The crime is also being investigated by the INSS CPMI, but unfortunately the work has been affected by political circumstances. In October, the government rule prevented the summons of José Ferreira da Silva, known as Frey Chico, brother of President Luiz Inacio Lula da Sila and vice president of the National Union of Pensioners, Pensioners and the Elderly of Forsa Syndical, one of the entities monitored by the authorities. He has not been formally investigated, but, like anyone else, he can contribute to the investigation. The Commission will not be able to move forward through Allied protection.
As an antidote to fraud, the Senate-approved bill prohibiting automatic deductions from union entities in the payrolls of retirees and retirees is welcome. The text, which would be approved by Lula, was presented in 2024, but only gained momentum in the wake of the scandal. Given the insolence of the malicious unions in forging licenses, this is the correct course of action. It is unfortunate that it did not come sooner, to prevent the beneficiaries from being robbed and the negligent government still having to foot the bill.
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