COAF Reported “Atypical Transactions” of R$2,5 Million by David Miranda

RIO DE JANEIRO, BRAZIL – A report sent by the Financial Activities Control Council (COAF) to the Rio Prosecutor’s Office two days after The Intercept Brasil website began to publish messages attributed to Lava-Jato officials, claims that federal deputy David Miranda had “atypical transactions” of R$2.5 million (US$625,000) in his bank account between April 2nd, 2018 and March 28th, 2019. Miranda is married to journalist Glenn Greenwald, the editor of The Intercept.

Based on the document, Rio Prosecutor’s Office opened an investigation into Miranda’s transactions. On Tuesday, as anticipated by Globo columnist Lauro Jardim, the 16th District Finance Court of Rio de Janeiro blocked the prosecutor’s office attempt to breach the deputy’s tax and banking secrecy. In a seven-page order that put the case record under judicial seal, Judge Marcelo da Silva requests that the deputy and four other people, including his advisors and former advisors, be heard before any precautionary measures be taken.

Questioned by GLOBO, Miranda said through his staff that the position of deputy is not his only source of income and, therefore, “the transactions are compatible with his family income.” The deputy earns R$33,700 in salary. He said that fractional deposits found by COAF come from this other source, a tourism company in which he is a partner of Glenn Greenwald. But he failed to disclose the services provided by the company and, through his advisors, said that other clarifications would be provided in court.

COAF’s report on Miranda was conducted as part of an investigation that found alleged irregularities in printing companies in the municipality of Mangaratiba, in the metropolitan area of Rio, with no direct connection to him. The deputy had hired the services of one of the companies under investigation and, therefore, eventually saw his account’s transactions sent by the COAF to the Prosecutor’s Office.

During the period analyzed, COAF points out that R$1.3 million entered the deputy’s checking account, registered at a Banco do Brasil branch in Ipanema, in the South Zone of Rio de Janeiro. Account debits totaled R$1.2 million in the same period. A transaction deemed atypical by the body does not imply that an illegality has been identified. The deputy claims to receive his deputy’s salary and sums from a company in which he is a partner with Greenwald into his account.

COAF states in the report that it believes that a number of deposits ranging from R$2,500 to R$5,000, made in cash, were “suspected of hiding their origin”. The report’s analysts point out the fractioning of deposits and also the existence of transfers from cabinet employees to the deputy.

Suspicion of a “kickback” scheme

Four of Miranda’s advisors and former advisors also had a breach of secrecy requested by the prosecutor’s office in the 16th District Finance Court, because their deposits were identified in Miranda’s account. The investigators suspect a “salary splitting” kickback scheme, where employees return part of their salaries to the deputy. The Prosecutor’s Office petition for breach of banck secrecy were denied by the judiciary, at least until depositions have been taken.

Reginaldo Oliveira da Silva and Silvia Mundstock, who are currently working in Miranda’s office in the Chamber of Deputies in Brasilia, are included in the secrecy breach request. They were employed in February this year when the deputy took office after the resignation of his party colleague, Jean Wyllys.

The prosecutors also called for the breach of tax and banking secrecy of Camila Souza Menezes and Nagela Rithyele Pereira Dantas, who have been stationed in the Legislative Assembly of Rio (ALERJ) since early this year, in the offices of state deputies Renata Souza and Mônica Francisco, both members of PSOL, Miranda’s political party. The investigation is focused on the “practice of administrative misconduct”, a civil infraction.

In addition, an investigation was opened into the alleged crime of embezzlement and money laundering, but as Miranda is a federal deputy, this proceeding was referred from the local Rio de Janeiro prosecutor’s office to the Office of Prosecutor General, in Brasília.

Miranda denies irregularities. In his filings with the Electoral Court, he declared he was a partner in Enzuli Management (in the United States) and Enzuli Viagens e Turismo (in Brazil). The deputy owns 18.75 percent of the US company and one percent of the Brazilian company, and both are also owned by journalist Glenn Greenwald, founder of The Intercept Brasil website.

The prosecutors pointed to the atypical transactions of R$2.5 million and an “increase of wealth potentially incompatible with that of the then city councilor” when it asked for a breach of confidentiality.

In the last election, in 2018, Miranda declared to the Electoral Court that he owned assets of R$353,400, of which almost 20 percent were related to a car and the remainder to investments in fixed income and capital funds. In the 2016 election, his declared assets amounted to R$74,825.00.

Reprisal

The deputy further stated that “in the absence of proof and evidence of any illegality, there is no doubt that [the investigation] is a reprisal“.

In his view, “the assumption that prompted the request for breach of secrecy makes no sense” and “it is obvious that it is a response to the work of The Intercept Brasil in covering the Vaza-Jato leaks”.

Miranda views the investigations as “persecution through the state system” and claimed that he is “providing the accounting statements of the company that generated the withdrawals and corresponding deposits” and that he is at the court’s disposal.

Last week, in an interview with “Roda Viva” by TV Cultura, Greenwald was asked about the case involving the deputy. To the interviewers, the journalist said that there will be no evidence against Miranda because he did not commit crimes.

“We are completely calm because it is a lie. It’s exactly the kind of dirty game they play and we’re not going to stop because of it,” Greenwald said.