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Police raid Banco do Brasil managers' homes in 200M-real money laundering probe

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Police raid Banco do Brasil managers' homes in 200M-real money laundering probe

Brazilian police raided the homes of four Banco do Brasil SA managers allegedly involved in money laundering operations between 2011 and 2014, the latest development in the ongoing Lava Jato, or the Car Wash, corruption investigation.

The managers were suspected of facilitating bank transfers of more than 200 million reais from accounts maintained by an unnamed criminal organization, the federal police said in a statement. A large chunk of the amount was converted to cash to be used in the payment of bribes by contractors involved in a corruption scheme at state-owned petroleum company Petróleo Brasileiro SA - Petrobras, the police noted.

In turn, the managers, linked to three Banco do Brasil branches in São Paulo, allegedly switched off the bank's money laundering detection system in exchange for bribes. This effectively allowed dummy companies operated by criminal organizations to open accounts at the bank for a long period for use in illicit transactions. The managers' actions also prevented the transfer of information to financial activities watchdog COAF.

Following its probe, the police agency said it informed Banco do Brasil of the alleged crimes, which resulted in internal investigations at the bank and produced further evidence of the illicit operations.

Banco do Brasil is just one of many companies across Latin America impacted by the sweeping Lava Jato scandal, which has revealed interlinked corruption schemes in national governments and in state-owned companies. Earlier this month, police raided Banco BTG Pactual SA's São Paulo headquarters and the home of founder and former CEO André Esteves on alleged irregularities in the purchase of oil fields from Petrobras.

As of Sept. 26, US$1 was equivalent to 4.15 Brazilian reais.