(Bloomberg) -- Miguel Gutierrez, the former chief executive officer of Americanas SA, was detained early Friday in Madrid as part of an investigation into a massive accounting fraud at the Brazilian retailer.

Brazil’s federal police confirmed the detention of the “main target” of its operation in Spain early Friday, identifying him only as the former CEO of Americanas, adding that Interpol carried out the arrest.

The detention comes a day after police carried out arrest and search warrants in Rio de Janeiro as part of its biggest operation yet into the case.

Gutierrez, along with former director Anna Saicali, were targeted with arrest warrants but police said both had fled the country. Their names were then included among so-called red notices with Interpol.

Gutierrez, who holds dual Spanish and Brazilian citizenship, is accused of being the mastermind behind the accounting fraud at Americanas calculated at 25.3 billion reais ($4.5 billion) which plunged the company into crisis in early 2023.  

A spokeswoman for his legal team didn’t return an email seeking comment. 

The former executive, who spent more than two decades at the retailer, has been in Spain since mid-2023 and previously denied the allegations, calling himself a “scapegoat.” His lawyers said Thursday that “he never participated in or knew about any fraud” and is collaborating with authorities where required. 

The case, which rocked the local business and financial industries in early 2023, is one of Brazil’s biggest corporate scandals ever. It took on even more attention since the largest shareholders of Americanas are also some of Brazil’s wealthiest businessmen. 

Billionaires Jorge Paulo Lemann, Carlos Sicupira and Marcel Telles have owned the business since the early 1980s and have agreed to inject 12 billion reais into the company as part of a recovery plan to overhaul 50 billion reais of debt after the scandal. 

The public prosecutor’s 183-page report released this week presented reams of evidence pointing to him as the mastermind.

The police are looking into possible accounting and marketing fraud, market manipulation and use of privileged information. Several former executives have signed plea bargains and are cooperating with authorities.

Amid the evidence presented were emails and WhatsApp messages sent between the executives discussing numbers and attempts to hide the true state of the firm’s finances. The inner circle around the CEO hid supply-chain financing agreements and created false advertising contracts and certain reports were only delivered to Gutierrez via pen drive, the prosecutor’s office said. 

The executives also sold hundreds of thousands of reais worth of shares in 2022 when it became clear that Gutierrez would be replaced by an outside CEO which authorities are investigating as insider trading.

“There is no doubt that Miguel Gutierrez had full knowledge of the fraud committed inside the Americanas group,” one section read. “There is countless other evidence that all the fraud was led by Miguel Gutierrez.”

Brazil’s federal court has not yet requested the extradition, according to people with direct knowledge of the case. The judge who ordered the arrest must make the request to the justice ministry, which analyzes the request and forwards it to the country’s foreign ministry, which in turn asks a Spanish court.

According to criminal code procedures, preventative arrests must be re-evaluated every 90 days. The court responsible for the case is the “10th Federal Criminal Court of the Judicial Section of Rio de Janeiro,” so the trial would take place there.

Brazil and Spain have an extradition agreement dating back to 1990 when it went into effect, according to the decree. In the case of a citizen of both countries, there’s no requirement to extradite the person though they could be tried in the other country under certain circumstances.

--With assistance from Thomas Gualtieri.

(Adds details on extradition process starting in the 15th paragraph.)

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