Illegal timber from Amazon carbon credit projects reached Europe, U.S.

High-class pool decks, furniture, floors, ceilings and boats. Those are some of the primary destinations of the valuable tropical timber that leaves South America in large containers to supply markets in Europe and the U.S.

But consumers may be taking home the spoils of crime. That may be the case for 21,538 cubic meters (760,607 cubic feet) of Brazilian timber exported to the U.S., Portugal, Belgium, Spain and France between 2023 and early 2024, according to an investigation by the Brazilian Federal Police.

This timber originated in forest management plans owned by Ricardo Stoppe, a physician and entrepreneur who is suspected of leading a criminal group responsible for extracting 38,000 truckloads of illegal wood from the Amazon Rainforest.

Mongabay first revealed the case in May, showing the connections between Stoppe — until then known as an Amazon conservationist and Brazil’s largest seller of carbon credits — and an illegal logging scheme.

A few weeks later, the Federal Police targeted the group in Operation Greenwashing, which also revealed Stoppe’s role in land-grabbing a plot of public land three times the size of São Paulo, Brazil’s largest metropolis, in Amazonas state.

Stoppe used the area to develop five REDD+ projects, whose carbon credits have been sold to companies such as GOL Airlines, Nestlé, Toshiba, Spotify, Boeing and PwC, Mongabay revealed.

REDD+ refers to a program aimed at reducing deforestation and forest degradation emissions. It operates on the principle that landowners are financially rewarded for preserving areas at risk of deforestation. The emissions prevented by this conservation effort can be sold as carbon credits, which companies can purchase to claim they are “offsetting” their carbon footprint. By doing so, these businesses claim to fight climate change by ensuring the protection of vital forests.

According to technical reports obtained by Mongabay, a significant portion of the timber illegally taken from Indigenous territories and protected areas was exported. “This practice highlights the transnational dimension of the criminal operations, amplifying the consequences of the legal-administrative land-grabbing scheme perpetrated by the organization,” the investigators wrote in a report.

The largest timber importer was the Portuguese company Costa & Durães. Based in Braga, it bought 21,184 m³ (748,105 ft³) of ipê (Tabebuia serratifolia) from Stoppe’s forest management plans, valued at 87,832 reais ($14,641).

Brazil is by far the world’s largest ipê exporter. Thanks to its beautiful, hard and sturdy wood, it is the most popular Brazilian species on the global luxury timber market. The trees, which take between 80 and 100 years to reach maturity, have almost disappeared from the Amazon.

“There are already local extinctions of ipê in the Amazon,” Rômulo Batista, Greenpeace’s spokesperson in Brazil, told Mongabay. “To give you an idea, when mahogany was still allowed to be sold, its highest value was $2,500. Today, a cubic meter of Ipê decking is worth $3,500.”

Costa & Durães bought the timber from an exporter called Madeiamazonia, based in Rondônia’s state capital, Porto Velho, and targeted in 2017 by Operation Arquimedes — Brazil’s largest raid against illegal timber exports. Madeiamazonia, in turn, bought it from a sawmill in Rondônia, which owes 1.8 million reais ($300,065) in environmental fines and supplied the product from Stoppe.

Both Madeiamazonia and Costa & Durães have the same owner, the Portuguese entrepreneur Carlos Manuel Fernandes Durães. Mongabay tried to reach Durães through his lawyer and by calling his company in Brazil, but none of them answered.

“These companies had an obligation to trace the wood from the exact point where it was cut until it was sold on the European market,” Batista said, adding that both the U.S. and the European Union have specific legislation requiring due diligence in timber imports. In France, courts have already sentenced two companies for buying illegal timber. “They have to assess any risk of illegality,” Batista said.

The origin of the timber was also confirmed by an on-site joint inspection carried out at Costa & Durães headquarters in November 2023 by the Portuguese National Republican Guard and the Brazilian Federal Police.

“There was this situation in which the wood that left Ricardo Stoppe’s farm ended up being seized in Portugal,” the federal deputy Thiago Marrese Scarpellini, chief Operation Greenwashing investigator, told Mongabay.

Dimapex, from Ariquemes municipality, in Rondônia, also exported Stoppe’s timber. According to official documents, it sold 354.8 m³ (12,531 ft³), valued at 3.6 million reais ($600,000), of ipê and angelim pedra (Hymenolobium petraeum), to customers including the U.S.-based companies Industrial Pine Products (42 m³ or 1,483 ft³), Oregon-Canadian Forest Products (35.3 m³ or 1,245 ft³), J.Gibson McIlvain (62.5 m³ or 2,207 ft³) and Rockland Wood Products (35.2 m³ or 1,243 ft³).

Dimapex also sold Stoppe’s timber to Vandecasteele (115 m³ or 4,061 ft³), in Belgium, and Select Timber Company (31 m³ or 1,094 ft³), which received it in France and Spain.

Vandecasteele, Select Timber Company and J. Gibson McIlvain had already been mentioned in a 2018 Greenpeace report as having supplied timber from fraudulent forest management plans.

In an email to Mongabay, Dimapex confirmed the purchase from Stoppe’s areas and said it was surprised by the alleged irregularities since all its purchases undergo rigorous due diligence. Read the complete statement here.

Vandecasteele said every shipment from Brazil undergoes a comprehensive due diligence procedure, including “thorough documentation, satellite imagery, and a detailed review of each company’s history within the supply chain.” Read the complete statement here.

Industrial Pine Products told Mongabay it had no interest in commenting. Oregon-Canadian Forest Products, J. Gibson McIlvain and Rockland Wood Products didn’t respond to Mongabay’s emails.

In Brazil, all logged timber must be accompanied by paperwork called a forest origin document (DOF), also known as a timber credit. Once environmental authorities approve a forest management plan, its owner can issue a certain number of DOFs, corresponding to the volume of trees they’re allowed to extract from that area.

Given the DOF’s significance to the timber trade, criminal groups in the Amazon specialize in getting approval for forest management plans in areas that won’t be fully explored. They then sell spare DOFs from unexploited timber to loggers who logged forbidden areas. By attaching the document to the illegal timber, criminals manage to introduce this wood into the legal market, a system disseminated in the Amazon logging industry, according to experts. These tactics are known as timber laundering.

“The entire production chain in the Amazon is contaminated,” said Greenpeace’s Batista. “This wood is a great motivator for opening up extensive roads within the forest, which ends up opening the door to other cycles of deforestation, land-grabbing and violence against Indigenous and traditional peoples.”

From August 2022 to July 23, the area illegally logged in the Amazon increased 19% from the same period a year earlier, according to Simex, the logging monitoring system developed by independent research institutes such as Imazon, Imaflora, Idesam and ICV. Kaxarari Indigenous Territory, which is in the surroundings of Stoppe’s forest management plans, is one of the most affected.

Phantom cattle

Besides profiting from carbon credits and illegal timber, Stoppe’s group is also being investigated for cattle laundering — in which herds from an illegally deforested area are sold as if they were raised on a legal ranch.

“He set up a scheme to win on all sides,” federal deputy Scarpellini told Mongabay. “He took possession of federal land valued at 800 million reais [$133.3 million]. Over it, he started making forest management plans, moving more than a million cubic meters of wood worth 600 million reais [$109 million]. At the same time, he is doing carbon credit projects, where he would have amassed 180 million reais [$30 million]. And now we have the hypothesis that he was using the animal transport documents to launder cattle raised in neighboring deforested areas.”

The alarm was triggered by the large number of animals reported from one of Stoppe’s farms, Nossa Senhora das Cachoeiras do Ituxi. According to the cattle transit guides (GTAs), documents that track the movement of cattle herds in Brazil, the property would have 6,258 cattle. The ranch, however, has only 624 hectares (1,542 acres) of pasture, enough to feed around 1,100 cattle.

According to the experts, this means part of this herd is actually elsewhere, and false information had been inserted in the GTAs. “The Stoppe nucleus has a phantom production of cattle to serve breeding in other rural areas with restrictions, resulting in significant negative environmental impacts, including deforestation,” Federal Police agents wrote in a report.

Cattle laundering is commonly used in the Amazon to sidestep slaughterhouses’ control mechanisms, which forbid the purchase of cattle from illegally deforested land. At Mongabay’s request, the Center for Climate Crime Analysis (CCCA) looked at GTAs to verify the cattle movement in Stoppe’s area between 2019 and 2021. The organization, a Netherlands-based nonprofit investigating emitters of climate-warming greenhouse gases, found that Nossa Senhora das Cachoeiras do Ituxi reportedly sent 3,772 cattle heads to 10 ranches over this period.

Two of these farms, both in Porto Velho, supplied JBS’ slaughterhouse in the same city, Rondônia’s capital. Sítio Cumaru, which received 111 cattle from Stoppe in May 2019, sold 180 animals for JBS from July to August of the same year. Sítio Garça Branca, in turn, supplied 130 cattle from Stoppe in March 2019 and sold 20 animals for JBS in July.

CCCA can’t confirm if the same animals that left Stoppe’s area were the ones sent to slaughterhouses, since they may have been mixed up with other herds in the intermediary farm.

Brazil’s federal environmental agency, IBAMA, embargoed Sítio Garça Branca thrice for illegal deforestation, in 2007, 2017 and 2022. This means its owners couldn’t use the area for cattle ranching and that the slaughterhouses shouldn’t have supplied animals from there.

In a statement sent to Mongabay, JBS said the farm was in compliance with the company’s socioenvironmental criteria at the time of the purchase. Read the full statement here.

Ricardo Stoppe was arrested in June, along with his son Ricardo Villares Lot Stoppe, its partners and sawmill owners José Luiz Capelasso and Élcio Aparecido Moço, and forest engineer Poliana Capelasso, who signed the likely fraudulent forest management plans used by the group. According to the Federal Police, a judge released Moço and Poliana Capelasso for medical issues.

The police also seized 1.6 billion reais ($266.8 million) in assets, including two airplanes, luxury cars and several pieces of jewelry.

Banner image: Timber illegally extracted from the Amazon by Ricardo Stoppe’s group was sold to the USA and Europe. Image © Bruno Kelly/Greenpeace.

Loggers and carbon projects forge odd partnerships in the Brazilian Amazon

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