Brazil Federal Police raid FGV think tank amid fraud, graft probe

By Rodrigo Viga Gaier

RIO DE JANEIRO (Reuters) -Brazil's Federal Police on Thursday carried out search warrants in the Rio de Janeiro headquarters of the Getulio Vargas Foundation (FGV) as part of a probe into alleged fraud, graft and money laundering in the globally respected think tank.

Three of the targets in Thursday's raids were from the Simonsen family, including the FGV's founder Ricardo Simonsen, Federal Police sources told Reuters.

In a statement, the FGV repudiated the raid, describing it as persecution and saying it would take appropriate measures.

"Alleged facts from up to 15 years ago... resulted in the filing of a civil lawsuit that was dismissed initially and, strictly speaking, dealt with all the issues now used to authorize the raid," said the think thank.

The FGV said it had signed a consent decree with Rio prosecutors, which was "rigorously complied with."

The probe began in 2019, the police said in a statement, as it investigated allegations that the think tank had fabricated friendly reports on behalf of federal and state agencies to provide a veneer of respectability to contracts won via corruption.

The Federal Police also accused the FGV of helping firms it backed overbill for contracts without public tenders, create illicit front companies, and pay off other firms to not compete in tenders they hoped to win.

Several FGV "executives hold offshore companies in tax havens such as Switzerland, the Virgin Islands and the Bahamas, indicating not only money laundering, but also tax evasion and tax offenses," police said.

Founded in 1944, the FGV works to promote Brazil's economic and social development. Last year, it was rated the world's third most important think tank, according to the University of Pennsylvania's Global Go To Think Tank Index Report.

(Reporting by Rodrigo Viga Gaier; Writing by Steven Grattan; Editing by Gabriel Stargardter, Bernadette Baum and Rosalba O'Brien)