United States v. IRB Brasil Resseguros SA

On April 24, 2023, the Department of Justice, Criminal Division, Fraud Section announced a corporate resolution with IRB, which will consist of an NPA with self-reporting and $45 million in victim compensation.  The CFO of Brazilian reinsurance company IRB, together with other IRB employees, enacted a scheme to mislead investors about Berkshire Hathaway’s purported investments in IRB.  When the scheme was revealed, IRB’s stock price dropped by approximately 30% and caused tens of millions in shareholder losses.

Monetary Amounts and Key Terms:

• Non-Prosecution Agreement – enhanced compliance self-reporting
  • $0 – Fine
    • No fine based upon inability to pay ($45,000,000 otherwise)
  • $5,000,000 – Victim Compensation Payment
    • On April 24, 2023, the Department of Justice, Criminal Division, Fraud Section announced a corporate resolution with IRB, which will consist of an NPA with self-reporting and $45 million in victim compensation.  The CFO of Brazilian reinsurance company IRB, together with other IRB employees, enacted a scheme to mislead investors about Berkshire Hathaway’s purported investments in IRB.  When the scheme was revealed, IRB’s stock price dropped by approximately 30% and caused tens of millions in shareholder losses.
      • Monetary Amounts and Key Terms:
        • Non-Prosecution Agreement – enhanced compliance self-reporting
          • $0 – Fine
            • No fine based upon inability to pay ($45,000,000 otherwise)
          • $5,000,000 – Victim Compensation Payment
            • Amount reduced based upon inability to pay ($45,000,000 otherwise)
        • Global Resolution?: No
        • Total Global Monetary Amounts: $5,000,000 (DOJ MIMF)
        • Total U.S. Monetary Amounts: $5,000,000
        • U.S. Criminal Monetary Amounts: $5,000,000
    • Amount reduced based upon inability to pay ($45,000,000 otherwise)
• Global Resolution?: No
• Total Global Monetary Amounts: $5,000,000 (DOJ MIMF)
• Total U.S. Monetary Amounts: $5,000,000
• U.S. Criminal Monetary Amounts: $5,000,000