A protagonist in one of Brazil’s most infamous corruption scandals is behind bars again, accused of participating in an international drug trafficking scheme alongside a state politician and a scandal-tainted former political adviser.
Brazilian black-market currency trader Nelma Kodama was arrested on April 19 in a luxury hotel in Lisbon, Portugal. Previously convicted in Brazil's infamous corruption scandal, Operation Car Wash (Lava Jato), Kodama was now a target of Operation Discovery, a sting against a criminal network that trafficked cocaine to Portugal in the fuselages of private planes. More than 40 search warrants and seven preventive arrest warrants were issued in the operation, which took place in five Brazilian states. Two arrests were made in Portugal.
The operation was the culmination of an investigation into a drug trafficking scheme exposed in February 2021, when Brazilian police seized 595 kilograms of cocaine from the fuselage of a jet belonging to a Portuguese air taxi company at Brazil's Salvador International Airport.
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The smuggling network – which comprised cocaine suppliers, aviation mechanics, flight coordinators and money launderers – moved drug shipments compiled from several drug trafficking organizations, allegedly including Brazil's largest criminal gang, the First Capital Command (Primeiro Comando da Capital - PCC). The same network was linked to 175 kilograms of cocaine seized at Lisbon's international airport in October 2020, as well as several other suspicious flights.
In April 2021, an initial operation against the network resulted in the seizure of eight aircraft and the closure of six aviation companies operating illegally.
Operation Discovery went a step further, identifying the alleged coordinators and financial operators behind the smuggling scheme.
The Black-Market Money Changer
Kodama, who has previously found herself in the spotlight for her brazen behavior on social media and for bursting into song at a Lava Jato inquiry, is accused of being a key coordinator for the network. She is suspected of working with Marcelo Mendonça de Lemos, a high-ranking member of the PCC, in the alleged cocaine smuggling scheme, according to federal police investigators who spoke with media outlet UOL.
Charged with various financial crimes during the past several years, Kodama was first exposed as a black-market currency trader in 2006, when the exchange house she worked for was implicated in a high-profile investigation into money laundering through bingo houses.
Kodama later became entangled in Brazil’s infamous Lava Jato case, which exposed systemic corruption at state oil company Petrobras, where executives took considerable bribes in exchange for overvalued construction contracts.
In 2014, she was arrested at São Paulo's Guarulhos International Airport with 200,000 euros ($215,000) in her underwear. She had been attempting to flee to Italy after learning she was under investigation in the Lava Jato case. Kodama was later sentenced to 18 years in prison for corruption, illegal foreign exchange and criminal organization. The charges against her stemmed from a money laundering scheme that moved more than $5 million abroad through shell companies and front-men. The scheme was done in collaboration with her then-partner Alberto Youssef, one of Brazil’s most notorious bankers, who was convicted in the Lava Jato case.
SEE ALSO: Chasing Brazil's Premier Money Launderer
Kodama made a memorable appearance at a 2015 commission inquiry into the Petrobras scandal, when she burst into a rousing chorus of the popular song “Beloved Lover” to describe her relationship with Youssef. The rendition prompted the commission’s president to remark: “Madam Nelma, we are not in a theater.”
While Youssef remains incarcerated, Kodama had her sentence terminated early, thanks to a cooperation agreement and a pardon from then-President Michel Temer in 2017. However, she came under investigation again in 2018, after appearing on social media wearing jewelry allegedly stolen from a mansion in São Paulo. She also caused a stir in 2019, when she posted a video on how to undo an electronic monitoring ankle bracelet.
Kodama had managed to slip out of the public eye until her recent arrest. Her lawyer told O Globo that “Nelma has nothing to do with drug trafficking,” adding that she was only arrested because of her previous relationship with lawyer and lobbyist Rowles Magalhães.
The Lawyer with 'Friends' in High Places
Magalhães was arrested in São Paulo on the same day as Kodama. According to UOL's summary of the Federal Police investigation, he is suspected of coordinating several aerial cocaine shipments, including the one seized in Salvador.
Like Kodama, Magalhães' name has been linked to a major corruption scandal.
While working as a political advisor to former Mato Grosso governor Silval Barbosa, Magalhães blew the whistle in 2017 on a kickback scheme in the bidding process of the state’s Light Rail Vehicle project. During the ensuing “Descarrilho” investigation, Barbosa confessed to taking bribes from the companies contracted to do the engineering work, which he claimed he used to pay off debts incurred during his 2010 gubernatorial campaign.
However, Magalhães also came under investigation when both Barbosa and a senior contractor alleged they had paid heavy bribes to Magalhães to persuade him – in the contractor’s words – to “stop pestering” Barbosa.
Magalhães' lawyers have told the press that there is no basis for his arrest and that his detention should be replaced with cautionary measures.
Also detained in Operation Discovery was Nilton Borges Borgato, Mato Grosso's former state secretary for science and technology who left in March of this year to field his candidacy for federal deputy. According to UOL, communications intercepted by the Federal Police indicate that Borgato may have been involved in hiring a jet from Portugal that was allegedly to be used by the cocaine trafficking network. When contacted by O Globo, his lawyer said that the arrest warrant does not detail specific charges, and that Borgato is at the disposal of the justice system while his counsel seeks access to his case file.
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