Fernando Passos, the former executive vice president of finance and investor relations of IRB Brasil Resseguros S.A., Brazil’s largest reinsurer and a company listed on the B3 exchange in São Paulo, has been ordered to pay a $500,000 civil penalty and permanently barred from serving as an officer or director of a public company, after a federal court in New York entered a final consent judgment against him on February 25, 2026. Passos had fabricated a Berkshire Hathaway investment in IRB in February 2020, forging a shareholder list showing that Warren Buffett’s conglomerate had made substantial purchases of IRB stock, planting the story with media in Brazil and the United States, and personally briefing at least four investors and one securities analyst on the fake stake during meetings held in both the United Kingdom and the United States.
IRB’s stock rose more than 6% in the 24 hours after the media reported the Berkshire news. A week later, Berkshire publicly denied ever having invested in IRB or intending to do so. The stock subsequently dropped more than 40%. The SEC filed its civil charges in April 2022. The Department of Justice unsealed a parallel criminal indictment against Passos the same day.
A Short Seller Report in January 2020 Triggered the Fabrication That Followed a Month Later
The scheme began with a crisis. In January 2020, Squadra Investimentos, a Brazilian investment firm, published a short seller report questioning the accuracy of IRB Brasil’s financial results. The report triggered a significant decline in IRB’s stock price and put the company’s credibility with investors under acute pressure. IRB was at the time one of Brazil’s highest-profile financial companies, having gone public on the B3 exchange in 2017 at a valuation that made it a flagship of Brazil’s insurance sector reform.
Passos, as head of finance and investor relations, was directly responsible for managing IRB’s relationship with shareholders and the investment community. Facing a stock in freefall and a short seller narrative he could not easily rebut with fundamentals, he chose to manufacture a counter-narrative instead. According to the SEC’s complaint, in February 2020 Passos created a fake shareholder list that showed Berkshire Hathaway had made substantial purchases of IRB stock. The choice of Berkshire was deliberate. An investment by Warren Buffett’s company carries a specific market signal about the quality of a business that virtually no other investor’s name can replicate. Attaching Berkshire’s name to IRB would not just stop the bleeding — it would reframe the short seller report as wrong.
Passos Planted the Story with Media and Briefed Investors Personally in the UK and the US
The fabrication was not confined to a document. Passos disseminated it. He shared the forged shareholder list with others and planted the story with media outlets in both Brazil and the United States. Brazilian and American financial press then reported that Berkshire Hathaway had recently invested in IRB, citing the apparent documentary evidence. Within 24 hours of those reports, IRB’s stock rose more than 6%.
Passos also took the false information directly to the investment community. According to the SEC’s complaint, he made false and misleading statements about Berkshire’s purported investment to at least four investors and one securities analyst during meetings held in both the United Kingdom and the United States. These were not passive recipients of media reports — they were active conversations in which Passos presented the Berkshire investment as fact to people making decisions about IRB’s stock. The international scope of those meetings is part of why U.S. courts had jurisdiction over a Brazilian executive and a Brazilian company.
Berkshire Denied the Investment Within a Week and the Stock Dropped More Than 40%
The deception had a brief window. Berkshire Hathaway, one of the most closely scrutinized public companies in the world, publicly denied within a week of the reports that it had ever invested in IRB or that it had any intention of doing so. The denial was categorical and came directly from the company. Once Berkshire’s statement reached the market, the story Passos had constructed collapsed entirely.
IRB’s stock, which had risen on the fabricated news, subsequently dropped more than 40%. Investors who had bought on the Berkshire reports, or who had held their positions in reliance on them, absorbed losses that traced directly to the fake shareholder list Passos had created. The SEC’s Denver Regional Office built the case against Passos while he remained in Brazil, a fact that underscored the agency’s reach into cross-border securities fraud affecting U.S. markets and investors. SEC Associate Director Jason Burt described the scheme as “brazen” and noted that Passos had “gone to great lengths to perpetuate his scheme, including doctoring a shareholder list.”
A Civil Penalty and Officer Bar Close the SEC Case as Criminal Proceedings Continue
The SEC filed its civil charges against Passos on April 18, 2022. The same day, the Department of Justice unsealed a parallel criminal indictment against him in federal court in Iowa. The civil case proceeded separately. Without admitting or denying the SEC’s allegations, Passos consented to the entry of a final judgment permanently enjoining him from future violations of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5, imposing a $500,000 civil penalty, and barring him from ever serving as an officer or director of a public company registered with the SEC. The final judgment was entered by the Court on February 25, 2026. The SEC’s litigation was conducted by Zachary Carlyle and Jodanna Haskins, supervised by Gregory Kasper and Nicholas Heinke of the Denver Regional Office.
Conclusion
The Passos case is a study in what happens when an executive in a market crisis decides that manufacturing good news is faster than delivering it. The Berkshire name was chosen precisely because its market authority is almost impossible to replicate. The fake shareholder list worked for exactly one week. Then Berkshire spoke, and four years of litigation followed. The $500,000 penalty and the permanent officer-and-director bar are the SEC’s civil conclusion to a scheme that began with a forged document, circled the globe through London investor meetings and Brazilian newsrooms, and ended with IRB shareholders absorbing a 40% loss in the days after Berkshire said it had never heard of the trade.
