A Brazilian prosecutor investigating potentially corrupt investments made by state pension funds said the real estate company run by Republican presidential candidate Donald Trump appears to have benefited “suspiciously” from a massive redevelopment of Rio de Janeiro’s port ahead of the Olympics.
The development, known as Porto Maravilha, or Marvelous Port in Portuguese, cost 8 billion reais ($2.5 billion) and developed run-down docklands into a plaza, museums, corporate and residential real estate. As part of the project, five 38-story buildings were meant to be erected under the Trump brand.
Public prosecutor Alselmo Lopes said in a court filing made public on Thursday that he is investigating the Porto Maravilha deal, in which the national employee severance fund FGTS, managed by state-bank Caixa Economica Federal [CEF.UL], paid up-front for building rights which it then sold on.
The structuring of the Porto Maravilha deal “favoured, in a suspicious way, the Trump Organization economic group”, among others, Lopes said. The prosecutor gave no further details and was not immediately reachable for comment.
His spokeswoman, Dionne Tiago, said Lopes would not explain the basis for his suspicions until next week.
None of the five people Lopes sought to charge in the court filing for siphoning off 8 billion reais from the Caixa’s pension fund were related to the Trump Organization.
The Trump Organization, which sold naming rights for the Rio towers but did not provide any funding for the project, did not immediately respond to requests for comment.
A senior executive involved in the Trump Towers Rio dismissed the prosecutor’s charge as baseless.
“Any allegations that the Porto Maravilha Investment Fund of Caixa Econômica Federal has favoured in a suspicious way the Trump Organization economic group are completely unfounded,” the executive, who asked not to be named, said by email.
Not long after plans for the towers were first announced, Donald Trump tweeted in January 2013: “The Trump Organization is going revolutionize Rio de Janeiro’s downtown port area with Trump Towers. Construction begins soon!”
Two of the five Trump Towers were supposed to be ready by the Olympics, but ground has yet to be broken. Developers say the project is still going ahead and has not been scrapped.
Trump Towers Rio on its website claims it is the first project in Brazil to bear the name of the U.S. real estate magnate and the largest urban office development in the BRICS group of leading emerging market countries.
(Additional reporting by Stephen Eisenhammer; Editing by Daniel Flynn and Bill Rigby)