Customer. A large European bank bought a Brazilian retail bank.

Problem. 03 years after the acquisition, a labor contingency of US$ 300 million was identified. The size of the contingency was strategically significant, calling into question the competence of the president of the bank in Brazil.

Business Extortion

Investigation. The investigation revealed the existence of a fraud, bribery, and extortion scheme led by the managers of the Brazilian bank's labor law department in collusion with outside lawyers. The amounts of labor claims were overvalued and agreements were made between the bank's internal and external lawyers and the claimants' lawyers. For example, a claim of R$ 20 thousand was increased to R$ 200 thousand. The amounts paid by the bank were divided among those involved. The scheme was coordinated by a law firm and outsourced lawyers had a choice of joining the scheme or being fired. Outside lawyers were extorted to pay bribes, provide travel and women for the bank's employment law managers. The leaders of the scheme organized orgies with prostitutes and drugs. Wolfe Associates identified the committed employees and attorneys and vulnerabilities in the processes.

The names of those involved were changed for reasons of secrecy. Investing in Brazil? You need to know who will manage your investment. Wolfe Associates can conduct profile studies of key executives.

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