Brazil's social security minister steps down amid pension fraud investigation

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SAO PAULO (AP) — Brazil ’s social security minister resigned Friday amid a police probe into a billion-dollar fraud scheme involving pension payments by the National Social Security Institute.

President Luiz Inácio Lula da Silva's administration said in a statement he accepted Carlos Lupi's resignation Friday during a meeting in the president's office.

The president invited former lawmaker Wolney Queiroz, the current Social Security executive secretary, to take over as minister.

On April 23, police said they were investigating a scheme that diverted over 6 billion reais ($1.05 billion) from pensions paid by the National Social Security Institute. Police said they seized 1 billion reais ($175.8 million) in assets and also issued arrest warrants for six people.

The probe targets 11 organizations that operated between 2019 and 2024. The scheme had retirees listed as members of associations that collected part of their monthly pensions as fees for the organizations. However, the retirees had never joined the associations and did not authorize the deductions.

As part of the probe, the president of the National Social Security Institute, Alessandro Stefanutto, and other directors were removed from their positions.

If the probe finds enough evidence, those investigated could face corruption charges, as well as charges of breaching secrecy, forging documents, setting up a criminal organization and money laundering.

Lupi said in a statement that he was stepping down but certain that his name has not been mentioned in the ongoing investigations, which he added were supported by his office and the federal government from the beginning.

“I hope the investigations continue naturally, identify those responsible, and punish, with full rigor, those who used their positions to harm the working people," he said. “I will continue to follow the matter closely and collaborate with the government to ensure that, in the end, any and all funds that were diverted from our beneficiaries are fully recovered.”

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