Brazilian priest convicted of embezzling nearly 700 smart devices donated to his institute

SÃO PAULO – A Brazilian priest has been convicted of aggravated embezzlement involving nearly 700 electronic devices, including smartphones and tablets, donated by Brazil’s Federal Revenue Service to the healthcare institute he headed.

A court found that Father Egídio de Carvalho Neto, then president of Instituto São José (Saint Joseph Institute), the sponsoring organization of Hospital Padre Zé in João Pessoa, Paraíba state, misappropriated 676 smartphones and tablets donated by the Federal Revenue Service.

Instead of auctioning the devices and transferring the proceeds to the institute, he sold them and kept the money, according to the verdict.

Carvalho Neto was convicted alongside Samuel Cunha Segundo, former head of the institute’s technology department. The priest was sentenced to five years and six months in a semi-open prison regime, while Segundo received a sentence of four years and seven months under the same regime.

Both were also ordered to pay US$ 102,500 in material damages and US$ 97,452 in collective moral damages.

According to a report published by Brazilian news portal UOL, Carvalho Neto and Segundo traveled to Foz do Iguaçu, in Paraná state, in May 2023 to receive the donation of hundreds of electronic devices from the Federal Revenue Service.

The plan was to auction the items and use the proceeds to purchase at least one ambulance for Hospital Padre Zé. The total value of the donation was estimated at R$ 807,000 (US$ 157,310).

Fifteen boxes containing the most valuable items were taken to the institute’s presidential office without being inspected, allegedly on Carvalho Neto’s orders.

Nearly two months later, when employees checked the contents, they discovered that 12 of the 15 boxes were empty. Carvalho Neto himself informed police that 676 devices were missing, but did not provide their International Mobile Equipment Identity (IMEI) numbers.

Investigators were able to obtain the smartphones’ IMEIs from the Federal Revenue Service and launched an inquiry. They soon identified a man who was selling the missing devices. He told authorities that he had purchased them from Segundo.

The police investigation also found that the institute’s CCTV cameras stopped functioning on June 26 and were only reactivated three days later. Segundo was responsible for overseeing the system.

Luciano Santoro, Carvalho Neto’s attorney, described the conviction as a “great injustice.”

“The evidence was clear that he had no involvement whatsoever in those acts and that he was, in fact, the one who reported the theft to the authorities. More than that, we proved that there is not a single financial transaction suggesting that he took part in the theft,” Santoro told Crux Now.

He added that “cases are no longer judged based on facts, but on people – or on the image constructed of them.”

“I am convinced that he was not convicted for having committed the crime, but for being Father Egídio, since the evidence of his innocence is compelling,” Santoro said, adding that he “fully trusts that the Honorable Court of Justice of Paraíba will correct this manifest injustice.”

Samuel Segundo’s attorney argued that his client merely followed the priest’s orders.

Indeed, Carvalho Neto’s case has drawn national attention in recent years. The disappearance of the electronic devices is just one of 11 criminal charges he faces.

In total, prosecutors accuse the priest of diverting R$ 140 million (approximately US$ 27 million) intended for Instituto São José and for the social works of the Archdiocese of Paraíba.

The funds reportedly came from João Pessoa’s municipal government and from the Paraíba state government through partnership agreements and were meant to finance social services, including the distribution of food kits to homeless individuals.

Instead, prosecutors allege that a criminal organization led by Carvalho Neto diverted the funds to purchase luxury assets, including real estate in upscale neighborhoods, vehicles, and works of art. At least 19 apartments and houses have already been identified by prosecutors as properties linked to Carvalho Neto. They were either registered in his name or in the name of people he knew.

He stepped down as president of the institute in October 2023, shortly after the alleged embezzlement was uncovered.

Carvalho Neto has been removed from all ecclesiastical activities since then. Arrested in 2023, he remained in custody for several months before being released in 2024 to undergo cancer treatment. He still appears in the Archdiocese of Paraíba’s yearbook as a resident priest.