Arrest of Ezekiel Castanha shines new spotlight on financial crime and may help bring breakthrough in effort to protect Amazon rainforest

For most of the past six years, Ezequiel Antônio Castanha had seemed a pillar of the community in the small Amazonian city of Novo Progresso. As the owner of a supermarket, hotel and car dealership, he provided more jobs than anyone else. Outside his municipality, few had heard of him. Neighbours described him as a “pessoa normal” (regular guy).



Today, however, the thick-set, middle-aged man sits in jail with a notoriety across Brazil as a Tony Soprano-like character whose businesses were used to launder money from one of the biggest land clearance syndicates ever uncovered.

Castanha was arrested last weekend, along with 15 associates, in what has been hailed as a major breakthrough for environmental enforcement. The local media have described the detainee as the “king of deforestation”. According to the environment ministry Ibama, he and his gang were responsible for about 10% of deforestation in the Brazilian Amazon last year.



Prosecutors are now asking judges to keep him in protective custody so that he cannot offend during what is expected to be a protracted legal process.



Facebook Twitter Pinterest Deforestation in the Amazon. Photograph: luoman/Getty Images/iStockphoto

“There has never been an investigation that has uncovered so much land and money related to one group,” said Daniel Azeredo, the lead prosecutor in the case. “If he remains in prison, we expect a fall in deforestation rates. If he is released however, it is very likely that he will continue with the same activities, due to a sense of impunity and of course, because it is a very lucrative business.”

His arrest – after several months on the run – already appears to have made a dramatic difference to land clearance rates. Since last August, when the investigation – named Operation Castanheira – was launched and a warrant was first issued for Castanha’s arrest, deforestation around the BR-163 road has fallen by 65%, according to the ministry.

This is positive news in an area that is one the frontline of illegal land clearance. In the year up to July 2014, 1,872 square miles (4,848 sq km) of rainforest was destroyed in Brazil, about a fifth of it along BR-163. Castanha is the main culprit, according to Ibama, which estimates he and his associates caused forest destruction valued at 540m reals (£130m)

Police wiretaps and court documents seen by the Guardian reveal how the gang’s shell companies hired workers to illegally occupy forest land near federal highway BR-163 in Pará. They then cut down the trees, sold the logs and burn what is left so the properties look like farmland and can be sold on to investors from the wealthy south-west of Brazil.

The syndicate registered the land under the names of shell companies to provide a veneer of legality to the sales. Anyone who challenged them was threatened with legal action or violence.

“They threatened to set fire to the Ibama office, stole confiscated equipment and committed homicides. They are very dangerous and highly organised,” said Luciano Evaristo, the Ibama official responsible for this case.

Prosecutors said a separate murder investigation involving Castanha was underway, but local people were too afraid to talk. Regional police chief, Everaldo Eguchi, told domestic media that the supermarket boss was “practically the owner of the city”.

Contacted by phone, many residents in Novo Progresso – which has a population of 25,000 – were unwilling to comment. One hotel worker, who asked to remain anonymous, said Castanho seemed like a regular guy. “He didn’t seem particularly rich,” he said.

Justice is often hard to come by in this Amazonian frontier, which is often described as Brazil’s wild west. For years, satellite data has revealed the massive environmental crimes being committed along the BR-163, but the perpetrators have continued their activities with impunity. Until now, Castanha has ignored 47m reals (£10.2m) of fines for forest destruction.

This time, however, the authorities hope for more success by focussing on financial crimes, such as money laundering, counterfeiting, tax evasion and fraud.

Forgery is a key part of the work of “quadrilha de grileiros”, or squatter gangs, who leave newly faked documents in cases full of insects so the papers appeared aged and authenticated.

With the addition of these white-collar crimes, Castanha faces up to 46 years in prison.

“This is a very important change,” said Paulo Barreto from the environmental monitoring NGO Imazon. “Whenever the government invests in infrastructure, the surrounding areas always fall victim to squatter gangs because of real estate speculation. So it is very important to have this more intelligent and integrated approach.”

Castanha’s lawyer says his client is innocent, that the charges have been trumped up by those who envy his success, and that he expects him to be granted bail at the first hearing on 11 March.

Many questions remain, including the identities of Castanha’s business partners, political protectors and whether the supermarket boss was really the top figure in the syndicate.

Ibama – which has come under fire in recent years for losing the battle against illegal forest clearance – says the gang was responsible for half of all deforestation in the BR-163 region, which accounts for 20% of the total in Brazil. Yet only 30 square miles (79.1 sq km) was in Castanha’s name – a significant area, but only a fraction of the overall amount. “Specific data about the total and the deforested areas are still matters of judicial secrecy,” Ibama told the Guardian.

Other powerful landholders are likely to have been involved. In one wiretapped conversation, Castanha says he made clear to his clients when the land he offered them was in protected areas:

“Even with these land grabbings, I never sold land that was in the reserves without telling people … I always told the truth,” he said. This suggests those who now own the illegal cleared land knew they were benefitting from a dubious transaction.

The prosecutor, Azeredo said a new investigation would be opened to address this issue. He also acknowledged that the case highlighted the weaknesses of Brazil’s land registration system, which has encouraged illegal land seizures.

Greenpeace said structural changes were needed to back up the success of investigators.

“We are still very far away from zero deforestation, which is our goal,” said Romulo Batista of Greenpeace. “One of the steps towards this is land regularisation. Because nobody knows exactly who owns what, it is currently too easy to sell deforested land.”

Castanha’s case gives hope, however, that it will not be as easy in the future.

Additional reporting by Shanna Hanbury