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Stealing Infrastructure Access in Brazil

The Brazil Business

Updated

30 April 2012

It is part of the “jeitinho brasileiro” to try to get away with everything. Especially if it is for free. Learn how Brazilians have access to all sorts of services for free.

Where has it begun?

At the beginning, it was a product of the lack of infrastructure of the Brazilian cities. As the cities were booming, the poor people were expelled from central areas and began to agglomerate in the outskirts of the towns, especially in the hills, as it happened in Rio de Janeiro city.

As these areas were not meant for living and had no previous urban planning, there was no infrastructure for these families, who lacked basic services such as electricity, piped water and sewage. The alternative found was to steal these services from the closest neighborhoods where they were available.

Several decades later, this practice is still present in the Brazilian society, but no longer restricted to infrastructure problems, as the government has worked to urbanize the Brazilian favelas. Now it is more a matter of getting a service for free, even when they are affordable.

Electricity

According to ANEEL, (Agência Nacional de Energia Elétrica) which is the national agency for electric power, 13% of all the electric power generate in the country gets stolen, causing a loss of annual BRL 7 billion.

Amazonas state occupies the first position in the ranking, stealing more than 30% of the electricity it produces. ANEEL points this problem as the main responsible for the high prices electricity providers charge for their services.

Apart from the loss it causes, it also brings severe risks to those involved in this practice. Electric shock, short circuits and burnings are some of the risks faced when making a clandestine connection. Every year, hundreds of families have their houses on fire due to short circuits occasioned by clandestine electric connections.

Even though illegal usage of electricity is seen as an alternative for the communities with no access to basic infrastructure, Cemig, which is the company in charge of energetic resources in Minas Gerais state, claims that 75% of its loss is caused by luxurious properties.

Water

Apart from households, companies and commercial establishments are constantly on the news for water stealing. It is estimated that every year, 37% of the water available for use gets lost and half of it (equivalent to BRL 2 billion) is lost in frauds and stealing, known as “gatos”.

One of the major consequences is the constant water rationing in the summertime and the price increasing.

Telephone

About two years ago, a police chief was arrested for illegal usage of the police station telephone. She had made a clandestine connection of the phone to her own house. As the police station telephone was constantly busy, citizens and colleagues have realized that something was wrong.

Such cases happen all the time, and in most of them the victim only finds out when the bill arrives.

Teleco, which is a Brazilian association of professionals working in the Telecommunications sector, points out more than 10 types of fraud in the usage of mobile devices. The most common are:

Cloning: constitutes the unauthorized copy of a terminal in order to have the calls charged from a valid phone number.
Hijacking: as soon as the authentication process is completed, high frequency transmitters capture the signal ofthe telephone and uses the call forwarding service to make phone calls. The real user is disconnected and does not know that his phone is being used.
Devices fraud: this type of fraud is the result of previous crimes. It constitutes the recycling of stolen devices and the reselling of subsidized or forged devices.
Prepaid fraud: yes, prepaid devices are also subjected to fraud. Some of them are the fraudulent credit recharge and the impossibility to check the credit balance.

Social status and paid TV

More and more it is common to see very poor residences - some of them made out of nothing but boards -, with a paid TV antenna. What happens in many cases is that the person buys the antenna and steals the signal from a neighbor. It is not uncommon to have one subscriber to the service and five other people using it for free.

Out of all “gatos”, I believe this is the one that mostly involves corruption: when asking for an antenna, the user offers some money to the company representative responsible for installing it, so that he can unlock the device or even teach him how to spread the signal. In many cases there is an agreement among the neighbors and the monthly fee is divided among them.

Stealing internet connection

As wi-fi connection spreads throughout Brazil, this type of crime has become more and more common. In most cases, people just walk around with their devices, trying to find an unlocked internet connection, but in some cases (and this requires some technical training), the thief changes the password of the internet connection he is stealing the signal from and uses it whenever he wants to (or until the neighbor finds out).

Just like paid TV, it is a common practice in Brazil to have one subscriber to the internet connection service sharing it with his neighbors and diving the fee. The current legislation is very unclear when it comes to classify this theft as a crime. Apparently, it only constitutes a crime when the stolen internet connection is used to commit crimes. However, Anatel can punish the subscriber that has shared the internet connection, as he is commercializing a service without proper authorization for it.

As an attempt to prevent these frauds, internet providers have created internet packages for as low as BRL 29,90. Also, local governments have invested in projects aiming the democratization of internet connection, such as Baixada Digital, in Rio de Janeiro.

Stealing is okay, just don't get caught

Just like mentioned in our article “Protecting Intellectual Property in Brazil”, there is a general social acceptance for robbery in Brazil, as long as it is stolen from the rich. If you ask a Brazilian who uses illegal paid TV if he does not think that he is guilty of a crime, he will probably tell you “they (the company) have a lot of money; I don't.”

It is so true that most Brazilians do not see this stealing as a crime that many of them will openly talk about it, as if it was something to be proud of, as they are being wise and cheating on the rich company. Also, you can easily find tutorials on the internet, teaching how to steal internet connection and electricity, and devices for illegal usage of paid TV signal are openly sold on websites like Mercado Livre.