All the Laws and regulations are readily available on Receita´s Federal Web Site:
http://www.receita.fazenda.gov.br/
I agree that with you that it might be the case of incompetence vs. the actual ill-intent.
The law (as of 12/01/2002) actually requires that all foreigners (and Brazilians) obtain a valid CPF number if they are to maintain property ownership in Brazil.
Then there is always the option of joining Moonies