Andréa Novais

Andréa Novais

The Brazil Business


Types of corruption in Brazil

Andréa Novais

Andréa Novais

The Brazil Business


Corruption in Brazil occurs in all levels of society: from politicians to police officers, passing through common citizens who pay extra BRL 50,00 for the cable TV employee to install a plan more expensive than the one they had originally subscribed to. Learn in this article what are the most common types of corruption in Brazil and how to avoid them.

What is corruption?

Corruption is often defined as using power or authority to obtain advantages and using public money for one’s own interest. In other terms, it means to:

  • Favor someone by harming others;
  • Bribery: to accept or to request financial resources to obtain a public service such as traffic tickets removal, biddings that would favor a particular company, tax exemption, etc;
  • To divert public money destined to public enterprises to those who are responsible for it;

These major forms of corruption are expanded to everyday life practices and are so deeply incorporated into that country’s culture that it gets hard to identify them. Also, as one of the most corrupt countries in the world, Brazil has got some particularities that must be discussed ahead.

Particularities of corruption in Brazil

In order to understand how corruption works so well in politics and public companies, being them transmitted to private companies as well, it is necessary to understand that corruption is part of our everyday life and is a way to move on in a country where things do not seem to work very well.

As mentioned in the article The Brazilian way of doing things, we Brazilians always find a way to solve everything and this way we find is most of the times some form of corruption.

As previously mentioned, corruption in Brazil occurs in several different levels. It was inherited by us from the Portuguese people who first came to Brazil and developed throughout the years, surpassing the corruption levels of our colonizers.

But before understanding what are the different faces corruption has shown us in our daily lives, it is important to understand what are the types of corruption recognized by the Brazilian law.

Legal definition

The Brazilian law defines corruption as a crime divided into three “modes”: active, passive and both active and passive.

Passive corruption

Happens when the public agent requests bribery (usually money) a public agent to do or not do something. As an example, we have the police officer who catches you driving without your seat belt and tells you that if you pay him a certain amount of money he would get rid of the ticket.

Active corruption

Happens when somebody offers bribery (not necessarily money, but goods as well) as an attempt to prevent the other part from doing something or having him doing something he shouldn’t. For example, it is common to have people offering money to get their driver’s license from Detran without having to succeed on the tests. In this case, the crime is to offer the bribery, regardless on the acceptance of the other part.

Passive and active

Happens when the two parts participate in the corruption. This is when bribery is offered and accepted. So, for example, if a person pulled over by a police officer offers an amount of money to get rid of the fine and the police officer accepts it, then we have a situation of passive and active corruption.

Also, a study made by Universidade de São Paulo has determined three types of corruption: the gray, the white and the black corruption:

  • Gray corruption: occurs when social actors evaluate a determined behavior in a controversial way;
  • White corruption: occurs when a social behavior is reproved by law and tolerated or even approved by the population, who sometimes does not even recognize the behavior as morally questionable;
  • Black corruption: occurs when both the law and social norms disapprove the behavior. In other words, it means that the law punishes it and society agrees that the behavior must be punished, classifying them as corruption (the corruption of politics, for instance).

Corruption in the business environment

After this introduction to how corruption is developed and perceived by the Brazilian society, it is time to approach it from a business perspective. The same study previously mentioned uses two major theories for corruption in the business environment: the income hunters and theory and the kickback or bribery theory.

The “income hunters” theory

In this theory, the basic motivation for economic agents is the maximization of their financial conditions. Corruption comes in when these agents try to obtain the maximum income through several privilege measures.

These income hunters are employees who recognize in corruption a way to get more profit than they would have through legal activities. Some examples of this type of corruption are:

  • The purchase and selling of goods without the issuance of an invoice;
  • Discounts concession through billing without the payment of taxes;
  • The commercialization of products with specifications that differ from the advertised ones;
  • The commercialization of products with a quality pattern inferior to those recommended by law;
  • The commercialization of fake products.

The kickback or bribery theory

This theory takes bribery and kickback into account due to the conflict between private and public assets. If we consider Max Weber’s theory that in an ideal State in which the bureaucrat behavior would be public and, therefore, decisions would never be personal, all employees would do their job with maximum efficiency. If any financial incentive (kickback or bribery) tries to break this impersonal relation, corruption would prevail.

The same happens in private companies when the maximum efficiency of an employee is diminished when someone, working in the company or not, transforms this professional relationship into a personal one in exchange of an illegal “favor”.

Bribery will then depend on the employee, who has the option to accept it or not and his decision is directly related to his formation and to the environment in which he works.

Examples of this practice are:

  • To pay public inspectors to guarantee licenses or special services;
  • Tax evasion;
  • The offer of money to get rid of fines;
  • The offer of bribery to establish agreements with government representatives or even between private companies;
  • The purchase and the commercialization of confidential material;
  • Employee fraud.

The most common practices of corruption in Brazil

After establishing what corruption is and how it occurs in different contexts, it is time to present the most hated (and yet most common) practices of corruption in Brazil:

  • To pay a police officer as an attempt to avoid a ticket;
  • Nepotism;
  • Non declaration of services by major companies as an attempt to avoid taxation;
  • To receive benefits from the government (such as unemployment insurance, retirement and other benefits like “bolsa família” or scholarships through ProUni) without having any rights to it;
  • Local government employees who provide access to the services offered by the prefecture and then by elections time demand votes from the population;
  • The distribution of medications, food and other “gifts” made by political candidates by the time of elections;
  • The adulteration of one’s own ID to receive some form of benefit;
  • Restaurants that offer food for free to police officers;
  • Employees who ask for money to manipulate public biddings.