Brazil Seeks US$38M Under Anti-Faction Law

BRAZIL · ORGANISED CRIME

Brazil has used its new Brazil Anti-Faction Law for the first time, asking federal courts to seize R$190.3 million (about US$38 million) in assets tied to the PCC and Comando Vermelho gangs. The Attorney General’s Office, known as the AGU, filed four civil lawsuits on Tuesday 20 October 2026, as O Globo, Valor and Gazeta do Povo reported.

For US readers the filings matter because Washington has labelled the same two gangs terrorist groups, which makes their money a sanctions question for banks, shippers and exporters dealing with Brazil. The AGU says the suits aim at financiers, front companies and relatives, not only at the people directly charged.

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Brazil’s Senate has also moved on gang legislation, as we covered in Brazil Senate Panel Votes on Gang Crackdown. Our guide Brazil Security and Crime Explained 2026 gives the background on both gangs.

How the Brazil Anti-Faction Law Works

Law 15.358 of 2026, known as the Anti-Faction Law, was sanctioned in March 2026 and allows what lawyers call civil forfeiture. It lets the state ask a judge to take assets of illicit origin without waiting for a criminal conviction of the owner.

Gazeta do Povo and iG both reported that this is the first time the AGU has used the law. The AGU’s litigation arm, the Procuradoria-Geral da União, filed the suits in federal courts in the states of Paraná, São Paulo and Rio Grande do Sul.

Forfeiture is not automatic under the Brazil Anti-Faction Law. The AGU has to show a link between the assets and illegal activity, and judges will decide on each request, iG reported.

The AGU said the suits drew on data and studies from the Justice and Finance ministries and the Comptroller General’s Office. The portal iG reported that the Justice Ministry added that tax-authority and court-council data helped identify high-value properties and hidden beneficiaries.

Amounts in reais are converted at the Central Bank of Brazil’s PTAX selling rate of R$5.0140 per US$1 on 20 October 2026. At that rate R$190.3 million is about US$38.0 million.

The Four Lawsuits Filed on 20 October

Three of the suits seek about R$82 million (about US$16.4 million) from 87 defendants in cases linked to the PCC. They stem from Operations Marola, Delivery and Contaminatus, which investigated the smuggling of Paraguayan cigarettes and the sale of banned pesticides.

The fourth suit seeks R$108.2 million (about US$21.6 million) and comes from Operation Hinterland, which investigated cocaine trafficking to Europe and money laundering. The AGU said investigators found financial movements above R$230 million (about US$45.9 million), plus properties, aircraft, luxury cars, companies and gemstones.

The AGU also said investigators found links between people in that case and a Comando Vermelho member, without proof of a formal tie to the gang. Reports therefore describe the four suits as aimed at both gangs, while the AGU stops short of a formal Comando Vermelho link in the Hinterland case.

The AGU said the strategy is meant to reach financiers, economic beneficiaries, front companies and relatives used to hide assets. It added that the tracing work relies on its Asset Recovery Laboratory, known as Labra, and on financial intelligence bodies.

O Globo reported that the cases are proceeding under seal, so it could not verify whether any judge has ruled yet. Valor likewise reported that the suits are under judicial secrecy.

If the courts approve the forfeitures, the money is to go mainly to the National Public Security Fund or to state security funds, Jornal GGN reported. The AGU argued that stripping the gangs of capital could weaken their ability to fund new operations, bribe officials and expand.

Washington Labelled the Same Gangs Terrorists

In late May 2026 the US State Department designated Comando Vermelho and the PCC as Specially Designated Global Terrorists, according to its press release as republished by Small Wars Journal. The Federal Register published the Foreign Terrorist Organization designation of both groups on Friday 5 June 2026.

As we reported in US Warns Americans Over Ties to Brazil PCC and Comando Vermelho, US officials later said that dealing with the gangs can carry risk for Americans as well. The Brazilian forfeiture suits are a separate domestic legal track and do not themselves apply US sanctions.

Hugo Motta, speaker of Brazil’s Chamber of Deputies, welcomed the filings on Wednesday 22 October in a social media post, writing that this is how you fight a gang, by taking its money. The Chamber’s news agency noted that Motta recalled the bill won 370 votes in the lower house.

What It Means for You

For investors and companies with Brazilian exposure, the filings show the state targeting assets linked to cross-border trade, farm chemicals, aviation and property. The cases described so far involve cigarette smuggling, pesticides and cocaine, and the reports reviewed name no listed company.

Compliance teams that handle Brazilian counterparties will want to follow how the courts treat these first cases, because they set the pattern for later ones. Our guides Brazil Power Structure Explained 2026 and Brazil Freezes About US$99 Million in Nationwide Organised Crime Raids show how earlier asset freezes unfolded.

Travellers and residents in the country’s largest city can find local context in our São Paulo expat city guide. One of the four suits was filed in São Paulo, though the reports reviewed do not say which assets are located there.

What Is Not Known

The AGU’s own announcement was not opened for this article, so the details rest on O Globo, Valor, Gazeta do Povo, Jornal GGN and iG, which agree on the amounts, the courts and the law number. Court decisions, the names of the defendants and the exact assets listed are not public because the cases are under seal.

It is not known when judges will rule, how much will ultimately be recovered, or whether the legal basis will face a constitutional challenge. The reports reviewed give no estimate of how much money the gangs hold in total.

Whether and how US authorities will use the Brazilian filings is also unknown. Nothing in the reports reviewed says Washington has commented on them.

Background: Brazil Election Polls: Flávio 51%, Lula 49%.

Background: Brazil Tax Reform 2026 Replaces Five Taxes With Two VATs.

Frequently Asked Questions

What is Brazil’s Anti-Faction Law?

Law 15.358 of 2026 was sanctioned in March 2026 and lets the state seek forfeiture of illicit assets without a prior criminal conviction. Judges must still approve each request.

How much is Brazil trying to seize?

The AGU is seeking R$190.3 million (about US$38 million) in four civil lawsuits filed on 20 October 2026. Three suits seek about R$82 million (about US$16.4 million) and one seeks R$108.2 million (about US$21.6 million).

Which gangs are targeted?

The suits target assets tied to the PCC and the Comando Vermelho. In the Hinterland case the AGU found a link to a Comando Vermelho member but no proof of a formal tie to the gang.

Has the United States designated these gangs?

The State Department designated both as Specially Designated Global Terrorists in late May 2026, and the Federal Register published their Foreign Terrorist Organization designation on 5 June 2026. The Brazilian forfeiture suits are separate from that US action.

Have courts ruled on the seizures?

Not as far as is public, because the cases are under seal. O Globo said it could not verify whether any decision has been made.

Sources: O Globo, 22 October 2026; Valor Econômico, 21 October 2026; Gazeta do Povo, 20 October 2026; Jornal GGN, 20 October 2026; Record TV news site, 20 October 2026; iG, 21 October 2026; Agência Câmara, 22 October 2026; Federal Register, 5 June 2026; US State Department press release as republished by Small Wars Journal, 1 June 2026; Central Bank of Brazil PTAX, 20 October 2026.

This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error · Editorial responsibility: Matthias Camenzind, Editor-in-Chief

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