Brazil judge approves tax evasion charges against Cisco exec

A federal judge cleared the way for a former Cisco Systems executive to be tried on tax evasion charges in a case alleging that the company benefited from a scheme to avoid duties on products shipped from tax havens to Brazil, an Associate Press report said.

The Associated Press report said Carlos Carnevali, who was Cisco's Latin America sales vice president, is accused along with 15 other people of setting up a network that used bogus documents showing unreasonably low prices to import electronic and telecommunications products and evade taxes, Judge Luiz de Oliveira said in a statement.

The world's biggest manufacturer of computer network equipment said Carnevali was fired because of the charges approved by the judge and that an internal investigation also found he violated the company's code of business conduct, the Associated Press report said.

The report said federal police last month raided Cisco's offices in Sao Paulo and Rio de Janeiro following a two-year investigation focusing on at least $500 million in products shipped to Brazilian clients from tax havens like Panama, the Bahamas and the British Virgin islands.

Those goods could have generated $833 million in tax revenue for the Brazilian government, authorities say.

The company published advertisements after the raids in major Brazilian newspapers to defend the itself against allegations, saying Cisco should not be targeted because it does not import products directly into Brazil, relying on resellers instead.

Brazilian authorities say a network of Brazilian and American companies, some real and some fake, were set up to carry out the scheme.

In the statement, Cisco said it was cooperating with authorities to determine whether any other employees were involved.

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