CVC Brasil inflated profits to meet bonus targets — then the stock fell 94%

Between 2015 and 2019, CVC Brasil — one of Brazil's largest travel agencies — systematically manipulated its accounts to present a healthier picture to the market. The company improperly recognised revenue and deferred expenses, artificially inflating profits. The manipulation was tied to executive compensation: the bonus programme was linked to EBITDA targets, and the accounting adjustments helped the company appear to meet them.

Luiz Fernando Fogaça served as CFO during most of the manipulation period (2010–2018) and was promoted to CEO in 2019. He left the company in 2020, and the new management uncovered R$362 million in accounting inconsistencies. The stock fell approximately 50% that year and never recovered, trading at just 6% of its end-2019 value by early 2026. The CVM (Brazilian securities regulator) began investigating in 2022.

In December 2025, the CVM formally accused Fogaça of negligence and breach of fiduciary duties, making him the sole defendant in an administrative sanctioning process. The CVM stated it had not found sufficient evidence of intentional fraud for personal benefit, but charged that Fogaça failed to correct the precarious accounting situation despite strong warning signs. The case is ongoing.