Phantom cows and missing millions
She has travelled 600km from the capital, Montevideo, to find 61 cattle she owns – at least on paper.
The missing bovines were part of a 'cow bond' scheme that has collapsed, triggering one of Uruguay's biggest-ever financial scandals.
The co-owner of one firm involved has died by suicide. Three companies have gone bust and are under investigation for fraud.
'Hello moo-moo! Could one of you be mine?' Palleiro calls out hopefully into a paddock, her jeans caked in mud as she approaches a wire fence to get a closer look.
Like hundreds of other investors, she is unable to locate her animals or prove they exist, making them part of a herd of 'phantom cows' that may number more than 700,000.
So far, losses total around US$350mil, shaking Uruguay – a nation of just 3.4 million people but home to 12 million cows.
The scandal has also sent ripples across Argentina and Brazil, where similar livestock investment schemes operate and Uruguay's cattle-tracking system had long been viewed as a model.
In March 2024, Palleiro put over US$50,000 of her life savings into a livestock investment scheme run by Conexion Ganadera. She was drawn by the promise of 7-10% fixed returns and glossy brochures featuring bucolic images of Hereford cattle.
Investors could either own specific cows to be reared and sold for profit, or take a stake in the broader scheme.
The appeal? A tangible asset she could track via a state-backed online portal, listing breed, age and location.
Each cow was to be branded with a government- assigned symbol, and her investment documents bore the agriculture ministry's crest.
But when she travelled to Artigas, papers in hand, to match the 53 cattle tracking numbers linked to this ranch, she found the reality didn't match the registry.
'It feels like falling into a nightmare,' she said.
A drone view shows cattle on a farm in Artigas.
Tesla crash that exposed the herd
Three firms now under investigation – Conexion Ganadera, Republica Ganadera, and Grupo Larrarte – convinced nearly 6,000 people or investor pools to join their schemes. Many such ventures across South America are legitimate, but this one began to unravel spectacularly.
The scandal's first public sign came on Nov 28 last year when a Tesla Model 3 crashed at 211kph in the city of Florida.
At the wheel was Gustavo Basso, a co-owner of Conexion Ganadera.
Weeks after his death – ruled a suicide by the coroner – investors reported missed payments. By January, the company admitted it was short of nearly US$250mil.
The firms blamed cash flow issues on adverse weather and market conditions, including a 2022-23 drought.
But by late January, panic set in as investors scrambled to recover savings and filed fraud suits, leading to bankruptcy proceedings and an investigation by Uruguay's Prosecutor's Office for Money Laundering Crimes.
Pablo Carrasco of Conexion Ganadera denies the allegations. His legal team has declined to comment before court testimony. Grupo Larrarte's lawyer says the company is cooperating. Republica Ganadera has not responded to media queries.
Fake cows, real losses
Among the thousands of victims are politicians, priests and pensioners.
An inventory by Conexion Ganadera's bankruptcy trustee found just 70,000-80,000 of the 804,604 cattle the company claimed to manage.
In another case, the agriculture ministry revealed that Pasfer, a key cattle-holding firm, had only 49 of 3,740 cows pledged as loan collateral.
'We don't know if the cows were ever bought, whether they're alive or dead,' said Palleiro. 'Maybe the cows were fakes, or sold, moved somewhere, or their tags were changed.'
Victims are questioning how such a massive failure went undetected within the much-lauded cattle registry.
Three lawyers allege that firms either never tagged animals or redirected investment funds elsewhere.
Others claim cattle were sold without investors' consent.
Each company handled its own tagging and registry inputs, with little oversight.
'The registry reflects what the company provided. The problem is that there was no control,' said lawyer Nicolas Hornes, representing 98 victims.
He visited several farms and found discrepancies between tagged cattle and registry entries. Other investors shared similar experiences.
The livestock ministry has not clarified whether the registry system failed.
Arrests and investigations
Grupo Larrarte was the first firm to face formal complaints.
One of its executives, Jairo Larrarte, is now in preventive detention on charges of fraud, misappropriation and issuing bad cheques.
His lawyer claims Larrarte has cooperated and returned some cattle to investors.
Republica Ganadera filed for bankruptcy in November, but the court rejected the move due to an ongoing investigation.
Talks with creditors are ongoing. In March, the company said it was seeking the best possible outcome for investors.
Several investigations into Conexion Ganadera continue.
Carrasco, his wife Ana Iewdiukow, and Basso's widow, Daniela Cabral, are being investigated for fraud and embezzlement.
A court barred them from leaving Uruguay in February, and their passports were confiscated.
'Snake charmer' and vanished fortunes
Basso, whose fatal crash was the scandal's turning point, had long lived in luxury in Florida, a town of 30,000 surrounded by farmland.
Local radio host Martin Fablet, a decade-long investor in Conexion Ganadera, remembered Basso vividly.
'He was a snake charmer,' Fablet said.
'He could never simply lose US$250mil... That money must be somewhere.'
Back in Artigas, drone footage over the ranch shows around 80 cows – far fewer than the hundreds Palleiro and fellow investors believed were theirs.
Workers mentioned salary delays and said more cows might be in distant fields, but no one could confirm which animals belonged to whom.
Palleiro is furious at the impact the scandal is having on ordinary Uruguayans.
She once juggled three jobs to build her retirement savings.
'We put in all our savings that cost us a lot of effort,' she said, her voice breaking. 'Now we want justice.' — Reuters
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