Summary: Eike Batista, previously worth $30 billion, is now $1 billion in debt after his businesses collapsed. He currently faces trial for insider trading charges.
Eike Batista, who once held the number 7 spot on Forbes’ list of the world’s richest people, faced trial Tuesday for insider trading charges, FindLaw.com reports. If convicted, he could be the first person in the country to go to prison for these charges.
Batista, 58, was once worth a whopping $30 billion. However, Batista has watched his fortune dwindle down over the past two years as his oil, mining, logistics and shipbuilding businesses have collapsed. The former billionaire used to love being in the spotlight and often stated he wanted to steal the title of world’s richest person from Mexico’s Carlos Slim, but now, Batista rarely appears in public and claims he is $1 billion in debt.
Here is an article about the status of one of Batista’s companies at the end of 2013.
Batista is on trial for market manipulation charges that stem from the sale of shares in two of his companies. This includes the OGX oil production and exploration unit that filed for bankruptcy protection just last year. Should Batista be found guilty, he will face fines and up to 13 years in prison. However, many predict that Batista would receive a lighter sentence, since he is a first-time defendant.
Batista maintains his innocence, explaining that the shares he sold did not belong to him, but to creditors. The trial is expected to have a great impact in Brazil, where the nation’s wealthiest citizens were believed by many to be above the law. However, the tone began to change in 2012 when the Supreme Court convicted 25 top officials of the Workers’ Party for their roles in a “cash-for-votes” arrangement.
Here is a recent article about another insider trading case.
Paulo Sotero, the head of the Brazil Institute at the Wilson Center, which is a Washington, D.C.-based “think tank,” observed, “This (the Batista trial) is one more episode in what I see as the affirmation of the rule of law in the Brazilian democracy. Impunity was so prevalent in Brazil it became part of the culture. Well, it looks like the culture is changing.”
Batista used to flourish in the light of press cameras, often welcoming reporters and photographers to his Rio mansion. Batista’s Lamborghini was parked in his living room. He was photographed during the Carnival celebrations with his former wife, a samba queen who sported a glittery dog collar that spelled “Eike” in rhinestones. Batista’s 2011 autobiography was a best-seller.
Batista’s climb to astounding wealth corresponded with the growth of the commodities market in Brazil. Annual growth reached 7.8 percent in 2008, but then fell to even levels, where it remains. Batista was number 7 on the Forbes list in 2012, but one year later, ranked at number 100, and the following year, was not included on the list at all.
In this insider trading case, post-its were used to share information.
This is not the first bout of legal trouble for the Batista family. Thor, one of Batista’s three sons, was convicted for manslaughter last year for the 2012 death of a cyclist he struck with his Mercedes-MacLaren vehicle. He was sentenced to two years’ community service and a 1 million real fine.
Photo credit: celebritynetworth.com