Finance Ministry Manages Denucci Scandal

By Luke Milner, Contributing Reporter

RIO DE JANEIRO, BRAZIL – On Saturday January 28th, Guido Mantega, the Brazilian Finance Minister, reportedly dismissed Luiz Felipe Denucci Martins, the Head of Casa da Moeda do Brasil (the Brazilian Mint), following accusations that Denucci was receiving bribes and depositing them in off-shore bank accounts. According to Folha de São Paulo, Mantega was informed in August 2011 that Denucci had begun to open offshore accounts in tax havens.

As early as 2010 Denucci’s name was linked to irregularities at Casa da Moeda. Further reports claim that the option of replacing Denucci was already being considered in 2011 and that a list of possible replacements for Denucci was drawn up during December 2011. However, Mantega maintains that he believed these earlier accusations to be unfounded.

The finance minister has denied that Denucci was dismissed as a result of the accusations printed against him in the Brazilian press, stating that it is usual for civil servants roles to be changed once they have fulfilled their objectives. Mantega also contradicted reports that he dismissed Denucci by claiming that Denucci resigned.

Members of the opposition are now calling for Mantega to appear before the National Congress and provide further explanations concerning the reported dismissal of Denucci. The Finance Minister is also being called on to explain the decision to open an investigation into the veracity of the allegations against Denucci, who was appointed to head Casa da Moeda in 2008.

In a statement confirming that Denucci’s replacement would have the specialist knowledge required to direct the Casa da Moeda, Mantega has said that three candidates to replace Denucci had been interviewed and that a replacement would be announced at the end of the financial year.

The Finance Minister did not discuss whether he would appear before congress. Aides to the President have stated that the Finance Minister has explained his actions to the President and that the Minister’s explanations have been accepted by the President.

There is currently no question of Mantega’s position being under threat as a result of the bribery allegations at Casa da Moeda. However, in the wake of the accusations against Denucci, a wave of changes at Casa da Moeda is expected.

José Martins, the Chairman of the company which revealed Denucci’s offshore financial transactions, is expected to appear before the National Congress in order to shed more light on Denucci’s dealings. Martins claims to have documents concerning the transfer of US$25 million by Denucci and his closest connections in the three years since his appointment at Casa da Moeda.

Reports suggest that this money came from companies which work with Casa da Moeda. These reports have been refuted by Denucci. The investigation into the allegations against Denucci is being conducted by three members of the Finance Ministry and will be concluded within thirty days.

Guido Mantega is a member of the Workers’ Party (PT) and was named in 2006 as Brazil’s Finance Minister, replacing Antonio Palocci, who resigned in the wake of corruption charges. Mantega’s tenure in the Finance Ministry has overseen a period strong of financial growth for the country, now the sixth largest economy in the world.