I'm Brazilian and I've never heard of capybara consumption in Brazil like this. But yes, they are animals that are part of our wild fauna.
Therefore, hunting, catching, capturing, collecting, slaughtering, transporting, translocating and/or handling any free-living wild fauna (including capybaras) is prohibited in Brazil.. They are protected by federal law and others. And most people know that consuming this type of meat could cause diseases in humans. But it is obvious that there must be cases where there is animal exploitation, smuggling, etc., since unfortunately where there are human beings there will always be something like this. In other words, there are people like this all over the world.