BRAZIL: Renuka do Brasil will seek compensation from banks

Published: 06/28/2018, 7:34:02 PM

Sugarcane processor Renuka do Brasil is preparing to seek compensation from foreign banks under investigation by Brazil's anti-trust agency Cade for losses resulting from an alleged cartel to manipulate foreign exchange rates years ago, according to Brazil's Folha de S. Paulo news website.

Renuka closed a total of US$1.3 billion in operations with foreign exchange from 2003 to 2013.

Last week, both Renuka and meat processor Aurora Alimentos asked a Brazilian court for the end of a minimal period they have to wait before filing lawsuit against the banks. Both companies were clients of Barclays, Citibank, Credit Suisse, Deutsche Bank, HSBC, JPMorgan, Kirton Bank, Merrill Lynch, Morgan Stanley, Standard Chartered, Tokyo Mitsubishi and UBS.

The companies' lawyers say that interrupting the time limitation to start a lawsuit against the banks is important because the current investigation process at Cade is not expected to end soon, and the companies will be able to claim compensation only after the banks are convicted.

The scheme to manipulate exchange rates was first discovered in other countries. Citigroup, JPMorgan and Barclays have entered into a leniency agreement with the U.S. Department of Justice, committing to pay billions of dollars in fines. In Brazil, the amount raised so far is of approximately BRL230 million (US$198.5 million)

Cade is investigating 20 banks, and have closed deals with Royal Bank, Morgan Stanley, Barclays, Citi, Deutsche, HSBC, JPMorgan and UBS since 2016.