Rio City Hall Temporarily Suspends All Payments and Financial Transactions

RIO DE JANEIRO, BRAZIL – Amid the seizures of the accounts of the City of Rio, a resolution of the municipal secretary of Finance, Cesar Barbiero, suspended all payments and financial transactions by the city.

The block in operations of the Undersecretariat of the Treasury began to apply at 2 PM on Monday, December 17th. The resolution is published in the Official Gazette of the Municipality.

In a note, city hall informs that the measure has the function of adjusting the accounts of the municipality because of the seizures ordered by courts. According to the municipality, the action is temporary and can be reversed at any time.

The city government has already had another R$92.1 (US$23) million blocked in a labor court action to pay debts to employees of the Social Organizations of Health (OSs), who are on strike due to delays in payments of salaries in October and November and the 13th month salaries.

The seizures occurred in Banco do Brasil accounts where the city’s accounts of the so-called sources 100 (Treasury funds) 109 (traffic fines) were deposited.

According to the Regional Labor Court (TRT-RJ), on Monday, a warrant was issued to the Bank of Brazil (BB) to transfer R$76.8 million of these blocked R$92.1 million to the OSs.

Normally, in the case of traffic fines, the money is used to settle commitments with a number of suppliers, such as companies that finance part of the activities of the Secretariat of Public Order. The information about the seizure was disclosed by the lawyer José Carlos Nunes, who represents the unions of health assistants and technicians, as well as the community health agents.

Last Friday, the city government had already suffered a first seizure in its accounts at the Banco do Brasil (BB), in the amount of R$ 67 million, complemented now with the balance of traffic fines at source 100. The remaining balance left the accounts on the same day out of source 109.

The accumulated total of seizures in the Regional Labor Court (TRT-RJ) already reaches R$ 159.1 million.

Several municipal agencies claim part of these resources to finance themselves. This sum reaches R$95 million, being R$25 million from the Prosecutor General’s Office of the Municipality (PGM), R$50 million from the Chamber of Councilmen of Rio, and R$20 million from the Court of Auditors of the Municipality (TCM).

A new conciliation hearing is scheduled for Tuesday.