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New York Attorney Morgenthau Aiding Brazil Wire-Transfer Probe

By Jeb Blount

Aug. 19 (Bloomberg)-- Manhattan District Attorney Robert Morgenthau said he is helping Brazilian authorities with an investigation into illegal wire transfers that led to the arrest of more than 60 moneychangers this week.

``We're delighted with the interest of the Brazilian authorities and their aggressiveness'' Morgenthau, 85, said in an interview from New York.

Morgenthau said he provided Brazil information from his prosecution of Beacon Hill Services Co., a wire-transfer company found guilty by a Manhattan jury in February on four counts of transmitting money without a license. Prosecutors said Beacon Hill moved more than $9 billion through JPMorgan Chase & Co. Authorities in Brazil believe money sent through Beacon Hill came in part from former Sao Paulo Mayor Paulo Maluf, Morgenthau said.

Maluf, a former governor of Sao Paulo state who is running for mayor in October elections, hasn't been charged with any crime related to the case. His press secretary, Adilson Laranjeira, said allegations that Maluf is involved are false.

``This is all politically motivated,'' Laranjeira said in a telephone interview from Maluf's campaign headquarters in Sao Paulo. ``People have been trying to involve Paulo Maluf in this operation for a long time and there is not a shred of evidence, that he is involved or even has a bank account abroad.''

Eight hundred Brazilian federal police this week raided currency-exchange houses in eight Brazilian states and arrested 62 moneychangers or ``doleiros'' on tax-evasion, money-laundering and other charges, Paulo Roberto Falcao, the federal police officer responsible for the investigation, said in a statement read by his press spokeswoman.

The probe is turning its focus to the clients of the doleiros, Falcao said.

``Not only was it important that we got the doleiros, but we also wanted to get their documents,'' Falcao said. ``We also want to get those who used the doleiros services to send money abroad.''

The name of the police operation is Farol da Colina, or Beacon Hill in Portuguese.

To contact the reporter on this story: Jeb Blount in Rio de Janeiro at jblount@bloomberg.net,

Last Updated: August 19, 2004 15:54 EDT

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