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In a statement, the CVM imposed total fines of
800,000 reais ($311,700) on Petros, as the fund is known. The
watchdog also issued warnings to but did not fine the workers'
pension funds of state-run banks Banco do Brasil SA <BBAS3.SA>
and Caixa Econômica Federal SA [CEF.UL] for the same cases.
The decision underpins the mounting conflict of interest between
pension funds like Petros and the government, which joined
forces in recent years to boost their decision-making power in
Petrobras, as the oil producer is known, at the expense of
minority shareholders.
Shares of Petrobras have shed half their value since a
government-sponsored capital injection that drew fierce
opposition from minority shareholders in 2010.
While funds belong to workers in those state-run companies,
their management is usually tapped among union members with
strong ties to the government.
The hefty stakes that Previ, Petros and other funds in state
companies have amassed in a handful of Brazilian companies for
years allow them to appoint board members and key personnel.
Petros and the other two funds, known as Previ and Funcef,
respectively, can appeal the CVM decision before the National
Monetary Council - which is Brazil's highest economic
policy-making body.
(Reporting by Guillermo Parra-Bernal Editing by W Simon)
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