April 12, 2018 / 11:40 AM / 9 days ago

Brazilian police arrest 10 in pension fund investigation

SAO PAULO, April 12 (Reuters) - Brazilian police have arrested 10 people in an investigation into alleged fraud at two public pension funds, they said on Thursday, as a years-long effort by authorities to uncover corruption in the nation’s pension system continues.

According to a statement, police also executed 21 search warrants in Sao Paulo, Rio de Janeiro, and the Federal District, where the capital Brasilia is located. They said they were investigating money laundering, tax evasion, and corruption at Postalis and Serpros, the pension funds for workers in the national postal service and national statistics systems, respectively.

“The illicit acts are tied to unsuccessful investments that generated losses at the Postalis and Serpros pension funds,” the police said, adding that the alleged scheme involved sending money abroad for services that were never rendered.

Serpros did not immediately respond to a request for comment. It was not immediately possible to contact Postalis.

Several Brazilian public pension funds have come under scrutiny from investigators in recent years.

Postalis, the nation’s biggest fund by number of participants, has amassed billions of reais in losses over the past decade due to risky bets. Prosecutors charged eight people, including the fund’s former president, with tax fraud and money laundering in May.

Reporting by Gram Slattery; Editing by Bernadette Baum

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