These funds, which corresponded to Petroleo Brasileiro SA (with state involvement), the Bank of Brazil, Caixa Econômica Federal (or CEF, Brazil's fourth largest bank), and the public postal service, were invested in a company of which Guedes is the main shareholder, according to the indictment of the Brazilian Public Prosecutor's Office and a report prepared by the National Superintendency of Summplemental Pensions.
Brazil's far-right President-elect Jair Bolsonaro, who won the country's most recent elections with a strong anti-corruption stance, has not spoken on the accusations against Guedes yet.
Guedes’ attorney has denied the accusations and said in a statement that all operations of the fund comply with the law.
"We reaffirm the correctness of all operations in the fund, which we have to say delivered profits to all its investors, including the pension funds," the lawyers said in a statement.
Guedes' defense said it hopes that, in the hands of the federal police, the investigation will raise "inconsistencies" they say appeared in an initial report about the case produced by Previc, a federal body overseeing pension funds.
The future minister is widely recognized as a Chicago Boy (a University of Chicago graduate), who has known ties with the group of economists that designed the ultra-liberal economic reforms applied by Chilean dictator Augusto Pinochet.
The Chicago Boys are credited with opening Chile up to free-market economics at the cost of the Chilean people after a bloody military coup against democratically-elected president Salvador Allende. “The Chicago boys saved Chile, fixed Chile, fixed the mess,” Guedes said.
The ex-banker now wants to implement neoliberal programs in Brazil.