Brazil minister resigns over suspected pensions fraud

Brazil’s new President Luiz Inacio Lula da Silva (right) greets Social Security Minister Carlos Lupi during the induction ceremony of the members of his cabinet, at Planalto Palace in Brasilia on January 1, 2023, after his inauguration ceremony. Brazil’s President Luiz Inacio Lula da Silva, with his popularity plummeting, accepted on May 2, 2025, the resignation of his Social Security Minister amid a corruption scandal over an alleged nationwide scheme to defraud retirees and pensioners, the government reported. — Photo by Agence France-Presse

Brazil’s minister for social security resigned on Friday over a scandal concerning an alleged scheme to defraud retirees of part of their pensions.

Carlos Lupi had been at the center of a storm over revelations that unions and other associations skimmed off part of people’s pensions, with the possible collusion of officials from the National Social Security Institute.

The head of the INSS, which administers pensions, was removed from his post last week over the allegations.

Four other INSS officials and a federal police officer were also suspended.

The office of the comptroller, which combats state corruption, said it detected unauthorized deductions from pensions for services such as legal assistance that many retirees said they never signed up for or received.

The investigation is focusing on 6.3 billion reais (about $1.1 billion) in deductions between 2019 and 2024.

It is unclear how much of that sum was taken illegally.

This is the second corruption case in under a month to topple a member of President Luiz Inacio Lula da Silva’s left-wing government.

In early April, Communications Minister Juscelino Filho resigned after being charged with taking bribes while he was a congressman in 2022.

Corruption is a sensitive issue for Lula, who himself served 1.5 years in prison in 2018-2019 for allegedly taking bribes.

His conviction was later annulled on the grounds that the judge in the trial had been biased.

The annulment allowed Lula to seek, and win, a third presidential term in 2022, but the whiff of corruption turned him into a pariah for many Brazilians.

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