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The stocks of Brazil`s major meatpackers, including the world`s biggest protein company, São Paulo-based JBS, were tumbled on Friday after police announced a corruption probe against the companies.
JBS was down 7.34 per cent to R$11.11 per share while BRF was down 7.43 per cent to R$37.03 per share on the news.
The probe centres on allegations that officials of the two companies paid off health inspectors to waive food inspection requirements for some of their products, writes Joe Leahy in São Paulo.
The federal police said the operation was the largest in its history with 1,100 officers executing 309 court orders, including 27 preventive arrests, 11 temporary arrests , 77 police interrogations, and 194 searches across seven states in Latin America’s biggest country.
They alleged officials of the ministry of fisheries and agriculture in three states acted to protect meat-packing groups and their partners “to the detriment of the public interest”.
“Public agents … through bribe payments, facilitated the production of adulterated food,” said the federal police in a statement.
Police said in a press conference that 34 public officials were under investigation and 20-22 were arrested while three senior executives of BRF, including a director, and two of JBS were also arrested.
JBS said the probe targeted three of its regional units and there was no action against its headquarters. It said it followed all food safety regulations and supported punishment of any violation of these regulations.
“The company highlights that it has various certificates from recognised entities around the world that prove it follows the best practices in the production of its good,” the company said.
BRF was yet to respond.