The Minister of Finance, Fernando Haddad, defended this Wednesday (29) a joint action between the federal and Rio de Janeiro prosecutors’ offices to combat tax fraud and the financing of organized crime in the fuel sector. The declaration occurred after the Superior Court of Justice (STJ) determined the maintenance of the closure of the Manguinhos Refinery (Refit)suspected of involvement in billion-dollar irregularities and links with criminal factions.
Signed by Minister Herman Benjamin, the STJ’s injunction suspended another injunction, from the Court of Justice of Rio de Janeiro (TJRJ), which had authorized the resumption of the refinery’s activities. The maintenance of the ban responds to a request from the Attorney General of the National Treasury (PGFN)which pointed out the risk of “serious damage to the economy and public order” if Refit were to operate again.
Haddad informed that the National Treasury attorney, Anelize Lenzi, will be sent to Rio de Janeiro to speak with the State Attorney General’s Office (PGE-RJ) and explain the reasons for the ban. “Dr. Anelize will contact the governor tomorrow to explain all the problems that Rio is facing. Apparently, he is not aware of the situation”, said the minister.
According to Haddad, institutional cooperation is essential to financially stifle organized crimereducing its ability to finance weapons and co-opt young people into communities. “We have to operate to stifle what fuels organized crime, which supplies it with resources for purchasing weapons and recruitment. We have to act upstairs as well,” he stated.
Collection
The government of Rio de Janeiro had appealed to the TJRJ to reopen the refinery under the argument that the stoppage would harm the state’s revenue, currently under the Tax Recovery Regime. Haddad, however, said that the best way to maintain Rio de Janeiro’s revenue is to resumption of tourist activities and investmentsharmed by the police operation that left more than 120 people dead in the state.
“No one can imagine that scenes like yesterday, with more than 120 deaths in police operations, will attract tourists, investment or increase revenue. The governor only stands to gain if he acts together with us”, he stated.
Haddad also reinforced that the fight against criminal organizations “cannot be treated as an electoral dispute”. On Tuesday (28), Castro had criticized the federal government for allegedly refusing to send armored vehicles to the state for actions against trafficking. “This is not an electoral platform. It is a dispute between the Brazilian State and crime”, countered the minister.
Operation Carbon Chain
The Manguinhos Refinery was banned in September by the National Petroleum, Natural Gas and Biofuels Agency (ANP)after irregularities identified in the Carbon Chain Operationconducted by the Federal Revenue Service.
The investigation is an offshoot of Operation Hidden Carbon, which investigates the infiltration of the First Capital Command (PCC) in the fuel market. According to the Tax Authorities, Refit would be a “contumacious evader”, failing to collect more than 80% of federal and state taxes between 2022 and 2024. The company is also accused of falsifying tax declarations, reporting that it was transporting raw materials when, in fact, it was sending ready-made gasoline – a practice that reduces the amount of taxes owed.
The IRS seized two ships transporting fuel bound for the refinery and suspects that stations controlled by criminal organizations were being supplied with Refit products.
In a note, the company once again criticized the ANP and the Federal Revenue, stating that the ban was based on “contradictions and inconsistencies” and that independent reports indicate that the vessels were carrying oil, not automotive gasoline. Refit also accused the ANP of having consulted Petrobras about taking over part of the market before the ban, which it classified as a conflict of interest.
Pressure from entities
The Instituto Combustível Legal (ICL) sent a letter to the ANP and the Federal Public Ministry asking for the immediate suspension of any Refit activity. The entity claims that authorization for the formulation and sale of fuels without proof of refining violates the agency’s technical rules and creates regulatory uncertainty.
The ICL warns that the partial release “distorts the competitive environment and creates a dangerous precedent” for the sector.
