Brazilian court orders R$1.1 billion repayment in major tax fraud case

A São Paulo court has ordered five executives from the soybean industry, a lawyer, and a former state tax auditor to return R$1.1 billion to the Treasury. The ruling stems from their alleged involvement in a sophisticated tax fraud scheme designed to divert ICMS tax credits and evade taxes, ultimately benefiting a major soybean business group in the state's interior.

In a 138-page sentence, Judge Jair Antônio Pena Júnior of the 1st Criminal Court of Bauru imposed prison sentences of up to six years and eight months on the defendants. They were convicted of money laundering and active corruption. The judge also mandated the solidary repayment of the R$1.1 billion, identified as the total loss caused to the São Paulo State Treasury.

The scheme came to light in May 2013 with the launch of "Operation Yellow" by the state's Public Prosecutor's Office. This investigation revealed a network of shell companies, allegedly established with a single address in Uruguay, to shield the assets, exports, and revenues of the former Grupo Sina. This group was once the country's largest grain crusher before entering judicial recovery.

Prosecutors allege that a group of tax auditors received bribes to refrain from issuing tax assessments. One auditor, accused of warning businessmen about the impending Operation Yellow, received a two-year sentence for violating official secrecy. All defendants have denied involvement in illicit activities and have the right to appeal their sentences while remaining free.