Finance Minister Fernando Haddad handed over to US Embassy Chargé d’Affaires Gabriel Escobar documents related to Operation Poço de Lobato, which investigates a tax evasion and money laundering scheme by the Refit Group, owner of the Manguinhos Refinery (RJ). The investigation indicated that the US state of Delaware was used to launder tax fraud in Brazil.
The Federal Revenue Service launched the process last week, in partnership with the public ministries of six states. According to investigations conducted by the agency, Refit Group had transferred 72 billion Brazilian reais in one year to hide profits through offshore companies in the state of Delaware, a tax haven.
Haddad’s handover of the documents comes after a phone call made by President Luiz Inacio Lula da Silva with US President Donald Trump, where they discussed the matter. The Minister met with Escobar early Thursday afternoon.
Haddad had announced on the day of the operation that he would submit the matter to the president to include it in the American negotiations.
-We want to discuss organized crime with the United States. They are opening companies in Delaware. They make a loan to obtain money, which, according to Revenue suspicion, will never be repaid, and this money returns in the form of investment in Brazil, as if it were a direct foreign investment – stated the Minister of Finance of the time.
Upon learning of Haddad’s letters, Lula asked the minister to submit a presentation detailing the fraud operations. Federal Revenue Minister Robinson Barreirinhas then made a presentation about the fraud to Lula and the ministers at a meeting at Palacio do Planalto.
At the end of the meeting, the President requested that the presentation material be translated into English so that it could be used in the conversation with Trump.
In the memorandum issued on Tuesday, after the conversation with Trump, the Brazilian government says: “President Lula also highlighted the urgent need to strengthen cooperation with the United States to combat international organized crime. He highlighted recent operations carried out by the federal government in Brazil aimed at financially stifling organized crime and specific branches operating from abroad. President Trump affirmed his full readiness to work with Brazil and that he will provide full support for joint initiatives between the two countries to confront these criminal organizations.”