A review of lawsuits filed with the São Paulo State Court of Justice, where the chain is concentrated, shows that some collections date back 13 years without successful payment.

One lawsuit filed by the São Paulo City Hall for nearly R$200,000, under the tax enforcement court, began in 2019, when the company failed to settle the initial claim. Ultrafarma argued that the debt certificate was flawed, but the court held that it was sufficiently clear and granted five days for settlement.

The case then stalled, remained suspended for a year in 2021, and only resumed on Wednesday (20), days after Operation Ícaro exposed the alleged corruption scheme, when the court reported that it was awaiting the terms of an installment plan.

Another lawsuit, from 2018, concerned unpaid health-waste collection fees totaling R$243,000 for 2012, 2013, and 2016. Since taxpayers can only be charged within five years of the obligation arising, only the 2012 debts were time-barred.

This debate dragged on for three years, with a change of judge, until the case advanced this month, on August 20, when the court reported that it had been included in a debt-recovery package prepared by the City Hall and the National Justice Council (CNJ), covering around 11,700 lawsuits. Ultrafarma is part of this group, but the installment plan is still pending.

In Santa Isabel (São Paulo), where Ultrafarma’s owner, Sidney Oliveira, lives, a 2022 lawsuit over a much smaller debt—R$740 in tax on services (ISS)—was paid nearly a year and a half later, but the case remains in court. “Silence will be interpreted as abandonment of the case, leading to its dismissal,” the tax enforcement court reported on July 29.

Ultrafarma’s lawyers, as well as the São Paulo and Santa Isabel city halls, declined to comment.

On August 12, the São Paulo state Prosecution Service launched Operation Ícaro, targeting Ultrafarma, Fast Shop, and the Finance Secretariat’s tax enforcement chief, Artur Silva Neto. Prosecutors are investigating whether Mr. Silva Neto received bribes to expedite Tax on Circulation of Goods and Services (ICMS) reimbursements for the companies.

On Thursday (21), Fast Shop director Mario Gomes had his R$25 million bail suspended and remains free after being released from temporary detention. Mr. Oliveira is seeking the same relief, claiming he lacks the funds.

Other companies cited in the investigation include Oxxo, fuel retailer Rede 28, and houseware chain Krystalmix. Authorities estimate R$1 billion may have been paid in bribes, with additional firms under scrutiny.

A potential plea deal by Mr. Silva Neto is adding pressure on the companies, given the possible revelations about the scheme. In case records, Judge Paulo Mello of the 1st Court for Tax Crimes even cited the potential impact of such a collaboration.

In recent days, executives in the food retail and pharmacy sectors have been exchanging messages to determine whether other competitors might also be implicated.

The concern is whether the alleged scheme involved not only expediting approvals but also inflating requests and creating fake reimbursement invoices, a line of inquiry that prosecutors were still pursuing last week, according to sources.

Valor has also learned that Smart Tax, a company owned by Mr. Silva Neto’s mother and allegedly the hub of the scheme, approached firms in the services sector, including mobile telecom operators, to offer ways to speed up reimbursements.

Executives from pharmacy chains told Valor that, in their dealings with the São Paulo Finance Secretariat, there is no direct access to tax auditors by phone or messaging—as alleged in the Ultrafarma and Fast Shop case. However, they said some officials act like “key account managers” for taxpayers with large ICMS volumes.

“They call us every month to check on sales performance, which helps them project ICMS collections,” said the CFO of a pharmacy chain. “We never know when we’ll get our credits released, but they want to know about revenues.”

The Ultrafarma investigation has also revived reports of personal disputes between Mr. Oliveira and Manoel Conde Neto, who founded Farma Conde in 1993, one of the most traditional chains in the Vale do Paraíba and North Coast areas.

Mr. Conde Neto was arrested in Operation Monte Cristo in 2017, which uncovered a tax-evasion scheme involving pharmacies and distributors. He was indicted, convicted in 2023 to four years and eight months in prison, but later received a judicial pardon under a plea deal.

He was also the first to name Mr. Oliveira to prosecutors and the Organized Crime Task Force (Gaeco) in a 2021 deposition. For some industry executives, this marked the beginning of Mr. Oliveira’s legal troubles.

“They haven’t spoken in years, and don’t want to hear each other’s names. Sidney hired some of Manoel’s former staff in the past, which caused problems,” said the owner of a family-run chain in São Paulo. “If Sidney is convicted, two of the industry’s most prominent businessmen could end up behind bars.”

According to prosecutors in São José dos Campos (São Paulo), the scheme involved products “traveling” between Goiás and São Paulo to pay less ICMS. In his deposition, Mr. Conde Neto cited Ultrafarma as an example: at one point, it sold two erectile dysfunction pills for R$0.67, when the ICMS cost alone would have been R$3.13.

“Until last year, Ultrafarma was selling at inexplicable prices, and it’s inexplicable that the tax authority didn’t shut them down. Even I underreported 10% of sales, while they underreported 60%,” Mr. Conde Neto told prosecutors at the time. Ultrafarma later paid R$31.9 million in fines following three tax assessments and struck a deal with prosecutors.

In a statement, Ultrafarma said it is cooperating with the investigation and that the information reported “will be duly clarified during the proceedings and will demonstrate innocence throughout the trial.” Mr. Conde Neto’s lawyers did not comment. The São Paulo Finance Department also declined to comment.

*By Adriana Mattos — São Paulo

Source: Valor International

https://valorinternational.globo.com/