A 21-year-old man was temporarily arrested by Brazil's Federal Police on Tuesday, August 25, on suspicion of taking part in a scheme to defraud benefits from the National Social Security Institute (INSS), the government body that manages Brazil's public pension and welfare payments. According to G1, the suspect worked as an intern at an INSS office in the Itapuã neighborhood of Salvador, the capital of Bahia state, and is accused of belonging to a criminal organization that investigators say caused 3.5 million reais (roughly 650,000 US dollars) in losses.
Federal Police said the group is suspected of inserting false data into INSS systems and defrauding 97 pension and welfare benefits identified so far. The investigation began about four months ago after police detected irregular activity in the system used by the Itapuã office. Among the tactics described by investigators, the group allegedly registered legal representatives on benefit accounts without the knowledge or authorization of the actual beneficiaries, giving those representatives the power to withdraw monthly payments and retroactive sums.
Investigators also found cases of benefits that had been suspended being improperly reactivated, releasing retroactive payments, and fraud involving the "proof of life" process, a periodic check Brazil requires to confirm that a benefit recipient is still alive. As a result, the INSS system recorded some beneficiaries listed as over 100 years old still receiving payments. Police said the fact that fraudulent legal representatives were registered across different Brazilian states points to the group possibly operating in multiple states.
Benefits allegedly faked from the start
The investigation also uncovered cases in which benefits appear to have been fraudulent from their creation: according to Federal Police, the personal data of people eligible for retirement was used to generate benefit payments before those individuals had even filed a formal request with the INSS. Police estimate that if the scheme had gone undetected, total losses could have reached 99 million reais.
Besides the intern's arrest, an 18-year-old second suspect was targeted with a search and seizure warrant. In total, the operation carried out two search and seizure warrants and one temporary arrest in Salvador. Federal Police said those involved could face charges of aggravated fraud, criminal association and insertion of false data into a government information system. The operation was carried out jointly with the General Coordination of Intelligence of Brazil's Ministry of Social Security, and the investigation continues as authorities try to identify other members of the group and determine the full scope of the losses to public funds.