Retail Titan's Fall: The Arrest of Americanas' Former CEO in $4.5 Billion Fraud Scandal

Miguel Gutierrez, former CEO of retail giant Americanas, was arrested in Madrid on fraud charges relating to a $4.5 billion scandal. Included on Interpol's wanted list, Gutierrez, who led Americanas until December 2022, is accused of insider trading and market manipulation. Extradition proceedings to Brazil have begun.

The former chief executive of retail giant Americanas, who is wanted in Brazil in connection with a $4.5 billion alleged accounting fraud, was arrested in Madrid on Friday at the request of Brazilian authorities, Brazil's federal police said. Miguel Gutierrez had been included in Interpol's wanted list on Thursday after a Rio de Janeiro court issued an arrest warrant against him, but Brazil's police did not manage to make the arrest since he was living abroad.

Gutierrez's defense lawyer said in a statement on Thursday, after news of the arrest warrant, that his client had never participated or known about any fraud during his time running the retailer. Gutierrez, who led Americanas for more than two decades until December 2022, is being investigated in Brazil as part of a probe into a 25.3 billion-real ($4.5 billion) alleged accounting fraud that led the firm to file for bankruptcy in January 2023.

Brazilian sources told Reuters that extradition proceedings will now begin to bring the former executive to trial in Brazil, although one police source noted extradition could be difficult because Gutierrez has dual Brazilian and Spanish citizenship. The judge who ordered his arrest as well as the search and seizure of evidence in the homes of 14 former Americanas executives said in an warrant seen by Reuters that police had provided convincing proof of insider trading and market manipulation.

The executives under investigation fraudulently altered the company's results to increase its share price, the judge wrote, citing the police probe. The judge added that when the revelation of alleged fraud became imminent, Gutierrez sold shares worth 171.7 million reais before the price plummeted. Federal police investigators have called it "the biggest fraud in the history of Brazil's financial market."

Americanas, one of Brazil's biggest online and bricks-and-mortar retailers, has long been controlled by three Brazilian billionaires who founded 3G Capital - Jorge Paulo Lemann, Marcel Telles and Carlos Alberto Sicupira. Americanas last year had accused Gutierrez and half a dozen other former employees of taking part in a fraud scheme.

Since the scandal was uncovered, Americanas has filed for bankruptcy, changed executives, revised its 2021 results

and agreed to a capital injection of up to 12 billion reais from its controlling investors, aiming for a recovery in 2025. ($1 = 5.5825 reais)