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The Brazilian Public Finance Ministry has published full information on the fraudulent activity of the Fruits of the Earth Association (Associação Frutos da Terra Brasil, AFTB) under false operations as a Civil Society Public Interest Organisation (Organização da Sociedade Civil de Interesse Público, OSCIP).  AFTB are being accused of operating as a financial institution without authority and unauthorised usage of a public federal organ accreditation.

Founded in 2007, AFTB’s stated objectives were focused on Brazil’s social and economic development and assisting on combating the country’s housing deficit via raffles which would enable its associates to access interest free housing finance without any down payment or proof of income required.  Associates were effectively paying to be able to partake in the effectively non-existent draws.

The initial inquiry was initiated in February 2010 when president of the organisation Carlos Alberto Lilienthal Rotermund admitted to operating a “pyramid” system whereby contributions of over 12,000 associates were leveraged into other financial applications such as Banking Deposit Certficates (Certificados de Depósito Bancários, CDBs).  During the investigation, AFTB announced the suspension of the multi-level marketing programme whereby those already in the association were able to bring new members on board.

According to the São Paulo  Attorney General’s Office, the Brazilian Central Bank published an official note stating that the AFTB is “not included in the list of institutions authorised to act as a financial institution nor management consortium and has neither made ​​an agreement to be an associated company [classified as a Civil Society Public Interest Organisation].”  If condemned, Rotermund faces up to four years imprisonment and a fine.