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Brasilia — A Brazilian prosecutor has opened a criminal investigation into investments made by two state pension funds in a luxury Rio de Janeiro hotel that is part of the Trump franchise, according to a court filing reviewed by Reuters on Tuesday. The 130-million reais ($40m) investment by the two small funds in the hotel’s developer "required investigation" due to its size, structure and high level of risk, Anselmo Lopes, a federal prosecutor in Brasilia, said in the document dated October 21 that opened the inquiry. Lopes said the pension fund for state IT firm Serpro and the Igeprev fund for employees of Tocantins state invested the money in the developer, LSH Barra Empreendimentos Imobiliários, which built the Trump Hotel Rio de Janeiro. "Investing amounts of such size, for these [relatively small] pension funds, breaks principles for diversification and liquidity," Lopes said in the document. "It is necessary to verify if the favouritism shown by the pension funds towards LSH ...

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