Alleged fraud at a Brazilian retailer sparks a corporate reckoning

Brazilian businesspeople are not easily shocked. In the past decade they have seen two business empires collapse in ignominy. Eike Batista, for a time Brazil’s richest man, lost his ports-to-mines group amid charges of bribery and market manipulation (for which he was briefly jailed). Marcelo Odebrecht, the scion of a construction dynasty, went to prison over the “Big Oily” graft scheme centred on Petrobras, the state oil giant.The latest scandal erupted on January 11th, when the new boss of Americanas, Sergio Rial, reported “accounting inconsistencies” that had allowed the 94-year old retail giant to hide 20bn reais ($4bn) of debt over a decade. Correcting the error swelled the firm’s debt to 43bn reais. Its shares lost 94% of their value. On January 19th it filed for bankruptcy. Mr Rial quit; his predecessor, who had run the firm for 20 years, is apparently nowhere to be found. Several creditors cried fraud.