(Adds comments from presidential aides, bank shares'
By Marcela Ayres and Lisandra Paraguassu
BRASILIA, June 8 A Brazilian presidential decree
raising fines on banks and other companies involved in illicit
acts aims to empower the country's central bank and the
securities industry watchdog to boost transparency, Finance
Minister Henrique Meirelles said on Thursday.
Speaking in Paris, Meirelles said the decree, which raises
fines for banks to as much as 2 billion reais ($610 million)
from 250,000 reais, had been under study for some time.
The decree announced this week also would allow the central
bank to strike plea-bargain agreements with financial firms that
admit breaching the law in exchange for softer fines or more
lenient prison terms for their executives.
Two presidential aides, who requested anonymity to speak
freely, said the government sped up preparation of the decree
because of the risk of new disclosures snaring Brazilian banks
in a vast corruption scandal.
An index of financial-sector companies on the Sao Paulo
stock exchange fell nearly 1 percent on Thursday.
The central bank is Brazil's banking and financial industry
regulator. A securities industry watchdog known as the CVM
oversees the functioning of capital markets. Congress has six
months to vote on turning President Michel Temer's decree into
"This certainly gives more power to the central bank and the
CVM to implement their measures," Meirelles said in comments
released by the Finance Ministry, without elaborating on the
size and scope of the new framework.
The minister's remarks reflected how senior officials see a
series of corruption investigations into cozy ties between
politicians and business leaders are evolving so quickly that
they require rapid action to fine-tune legislation.
The central bank said in a statement on Thursday that the
value of fines in eventual leniency agreements would depend on
the gravity of the infractions committed, as well as the size
and the financial capacity of a financial institution to bear
with such a penalty. The decree is not retroactive, it said.
The decree came as Congress launched an investigation into
the stock and currency trades of Brazilian meatpacker JBS SA
as news broke of a plea-bargain testimony from its
Meatpacking is the latest sector of the economy to be hit by
a three-year corruption investigation in Brazil, which
contributed to the impeachment of former President Dilma
Rousseff last year and now threatens Temer, her successor.
($1 = 3.28 reais)
(Reporting by Marcela Ayres; Writing by Alonso Soto; Editing by
Frances Kerry and Bill Trott)