The designation of the First Capital Command (PCC) and the Red Command (CV) came shortly after Brazilian Senator Flávio Bolsonaro visited Washington and publicly said he had urged U.S. officials to apply the terrorism label to the gangs. The decision has sharpened political divisions in Brazil, where public security is expected to be a central issue in October’s presidential election.

U.S. Secretary of State Marco Rubio announced that both organizations would be designated as foreign terrorist organizations beginning June 5. Until then, the groups have been classified as specially designated global terrorists, a status that restricts financial transactions and expands sanctions-related measures.

Election Politics Move to the Forefront

Several analysts cited by the Associated Press argued that the timing of the decision suggests broader political motivations beyond law enforcement concerns.

Brian Winter, editor of Americas Quarterly, said the move was largely political and could increase pressure on President Luiz Inácio Lula da Silva while strengthening Flávio Bolsonaro’s campaign ahead of the election. Carolina Grillo, a sociology professor at Fluminense Federal University and specialist in organized crime, also said the designation appeared aimed at potentially influencing the electoral environment.

The designation followed meetings in Washington between Flávio Bolsonaro, Rubio and President Donald Trump. Bolsonaro, who hopes to challenge Lula in the October vote, has presented the U.S. action as evidence of his commitment to combating organized crime.

Lula Condemns Move as Sovereignty Issue

Brazilian President Lula strongly criticized the U.S. decision and described it as an unacceptable intrusion into domestic affairs.

Speaking at a public event, Lula argued that Brazil was already pursuing major investigations and enforcement actions against organized crime and rejected suggestions that foreign intervention was necessary. He also accused political opponents of encouraging outside pressure on Brazil for electoral purposes.

Brazil’s government has consistently opposed classifying domestic criminal organizations as terrorist groups. Officials have instead emphasized police operations, financial investigations and international cooperation on money laundering and arms trafficking.

Questions Over Security Rationale

The U.S. government justified the designation by arguing that the PCC and CV operate extensive criminal networks whose influence reaches beyond Brazil and affects regional security, including the United States. Rubio described both groups as among Brazil’s most violent criminal organizations.

However, some experts questioned whether the decision was driven primarily by direct security concerns.

Grillo noted that major cocaine trafficking routes supplying the United States generally pass through Colombia, Mexico and Central America rather than Brazil. She said most cocaine seized in Brazil is ultimately destined for European markets.

The PCC and CV remain among the most powerful criminal organizations in Latin America, with authorities and researchers estimating that the two groups collectively have tens of thousands of members and maintain operations extending across South America and into Europe.

Economic and Diplomatic Risks Emerge

The designation has also raised concerns among legal experts and business groups about potential economic consequences.

According to Reuters, lawyers warned that companies operating in regions where the gangs exert influence could face increased compliance scrutiny from financial institutions and regulators. Sectors including agribusiness, mining, energy and telecommunications were identified as potentially vulnerable to expanded oversight linked to sanctions enforcement.

Brazilian officials have expressed concern that the terrorist classification could create broader diplomatic tensions and expose businesses to risks even when they have no direct connection to criminal groups.

Security Becomes Central Election Issue

The dispute arrives as crime and public security increasingly dominate Brazil’s political debate.

Recent operations by Brazilian prosecutors targeted money laundering, fraud and financial networks allegedly linked to the PCC and CV, with authorities describing the investigations as evidence that Brazil is addressing organized crime through domestic institutions.

Political analysts cited by the Associated Press said the U.S. designation could strengthen Bolsonaro’s campaign messaging by focusing attention on one of Lula’s most politically sensitive issues. Whether the move significantly affects voter attitudes remains unclear as the election campaign intensifies.

The broader implications of the designation — including its impact on U.S.-Brazil relations, financial oversight and the presidential race — remain uncertain as implementation approaches. Authorities in both countries have not publicly outlined any additional measures beyond the designation itself.

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