Brazil Cracks Down on Fuel Fraud Scheme Linked to PCC, Illegal Methanol Imports Through Paranaguá Port

A large-scale operation was launched this Thursday (28) to dismantle a billion-real fuel fraud scheme involving members of the PCC (First Capital Command), which relied on irregular imports of methanol through the Port of Paranaguá.

The “Operation Hidden Carbon” is executing warrants in eight states, exposing a complex network of fuel diversion and adulteration that harmed consumers and generated exorbitant profits for organized crime.

Methanol entered Brazil through the Port of Paranaguá, Paraná, with documentation falsely indicating legitimate use by chemical or biodiesel companies for industrial purposes.

However, truck drivers diverted the product directly to gas stations in Greater São Paulo and other regions, bypassing regulatory oversight.

Investigations found that methanol made up as much as 50% of gasoline sold at some stations—far above the 0.5% limit set by the National Petroleum Agency (ANP).

Frauds were detected in multiple gas stations, both in terms of quality and volume. The operation is the result of a task force led by the São Paulo State Prosecutor’s Office (MPSP), with support from several agencies, including the Federal Revenue Service and Federal Police.

According to investigators, the criminal group transferred approximately R$52 billion (US$9.5 billion) between 2020 and 2024 through around 1,000 gas stations across ten Brazilian states.

About 1,400 agents were deployed across eight states, targeting more than 350 individuals and companies suspected of committing economic crimes, fuel adulteration, money laundering, and tax fraud.

Authorities estimate more than 10 million liters of methanol were diverted, generating billions in illicit profits while deceiving consumers with adulterated, low-quality fuel.

Illicit gains included R$7.6 billion in tax evasion alone, which were laundered and hidden through a complex network of shell companies, fintechs, and investment funds to hinder tracking of the dirty money.

Source: CNN Brasil

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