Title: Brazil’s Business Landscape: Addressing Persistent Challenges of Corporate Fraud and Financial Crimes

Overview

Brazil’s business landscape faces a multifaceted assault of fraud and financial crimes, according to the 2019/20 fGlobal Fraud and Risk Report. In this article, we’ll discuss how companies in Brazil are dealing with issues such as bribery and corruption, money laundering, cybercrime, and geopolitical risks.

Bribery, Corruption, and Money Laundering

Bribery and corruption: Brazil has a significant issue with bribery and corruption, with 29% of respondents reporting experiencing such practices (compare to the global average of 22%). While this is a concern for businesses worldwide, Brazilian companies prioritize fighting bribery and corruption more than others, with 77% of respondents considering it a top concern [1]. This emphasis resulted from the Lava Jato scandal, which began in 2014.
Money laundering: Money laundering is a common companion to bribery and corruption, and it’s more frequent in Brazil than anywhere else in the survey (23% vs. 16% globally) [1].

Cybercrime in Brazil

Internal information leaks: Companies in Brazil report internal information leaks more frequently than their global counterparts, often through computer networks (55% vs. 39% globally) [1].
Data theft risk: Data theft is the top risk priority for Brazilian businesses (84% vs. 76% globally) [1].

Confidence in Compliance Systems in Brazil

Perception of compliance effectiveness: Confidence in compliance systems in Brazil is relatively low, with only 74% of respondents finding such measures effective [1].
Transparency and accountability: While respondents give their Brazilian organizations above-average marks for transparency and accountability, there is room for improvement, particularly concerning the alignment of performance goals and incentives with risk management practices (65% vs. 71% globally) [1].

Geopolitical Risks for Brazilian Businesses

Newly imposed sanctions: Fifty-eight percent of respondents reported that their organizations have felt the impact of newly imposed sanctions, making Brazil the second-highest country after India (59%) [1].
Government influence: Sixty-one percent of respondents in Brazil reported government influence on a vendor, partner, or customer, compared to the global average of 51% [1].

Brazilian Attitude Towards Cryptocurrencies

Current use of cryptocurrencies: Ninety-seven percent of respondents in Brazil said their organizations are investigating or actively using cryptocurrencies [1].
Concerns about cryptocurrencies: Despite the widespread use, 74% of respondents expressed concerns that cryptocurrencies could lead to the destabilization of fiat currency, a higher percentage than the global average of 53% [1].

For more insights and recommendations on how businesses operating in Brazil can effectively manage these challenges, download the 2019/20 fGlobal Fraud and Risk Report.

[1] - fGlobal Fraud and Risk Report, 2019/20 [2] - PwC global website: Economic Outlook 2020.