Odebrecht Signs Agreement with Government of Peru

Odebrecht and the government of Peru signed an agreement which will allow the Brazilian construction conglomerate to operate in the country, according to Reuters.

Two sources told Reutersthat Odebrecht will have to pay an approximately US$180 million fine over 15 years and admit to paying bribes related to four infrastructure projects.

Another source said, “The 15 years’ time frame was established for the payments because Odebrecht is technically bankrupt.”

However, the fine is less than half the amount owed to Peru for illegal cost overruns caused by Odebrecht’s bribes.

“I’ll charge the rest to Odebrecht’s former partners, as well as businessmen, high-ranking government officials, former presidents and former ministers involved,”
prosecutor Jorge Ramirez told Reuters.

The Odebrecht corruption scandal became public in December 2016. Over the course of more than a decade, Odebrecht funneled nearly US$800 million in bribes to officials of foreign governments, state-owned companies, and political parties across Latin America and the Caribbean.

In its investigation, the United States Justice Department found that Odebrecht paid out  US$29 million in bribes in Peru, which resulted in US$143 million in illicit gains. 

Former Peruvian presidents Aljejandro Toledo, Alan Garcia, Ollanta Humala, and Pedro Pablo Kuczynski, as well as the current opposition leader and several local construction companies, are under investigation in connection with Odebrecht’s illegal bribery scheme. All have maintained their innocence.

Argentina, Brazil to Share Some Information Related to Operation Car Wash

Officials in Argentina and Brazil signed an agreement which will allow some information to be shared among authorities in both countries related to the Odebrecht corruption case, according to The Rio Times.

“After a long negotiation and dialogue between the Secretariat for International Cooperation (SCI), inside Brazil’s Federal Public Ministry, and Argentine authorities, we have managed to reach an agreement so that corruption allegations in Argentina can be made available to the prosecutors there,” said the head of the SCI, Cristina Romanó.

Under the agreement, courts in both countries will be able to use information gathered from plea agreements made in either Argentina or Brazil.

“This is a huge step forward in the relationship of international legal cooperation between the two countries and another big step in the fight against corruption,” concluded Romanó.

Similar agreements already exist between Brazil and Switzerland, Norway, and the Netherlands.

The agreement comes after the Brazilian Attorney General and Comptroller General signed a leniency deal with Odebrecht in return for a 2.77 billion reais fine, equivalent to more than US$700 million.

A United States Justice Department report found that Odebrecht routinely used bribery in both Argentina and Brazil. Between 2007 and 2014 $35 million in bribes were made in Argentina resulting in $278 million in benefits for Odebrecht. Between 2001 and 2016 US$439 million in bribes were made in Brazil resulting in US$1.4 billion in benefits for Odebrecht.

Brazil Attorney General, Comptroller Sign Leniency Deal with Odebrecht

The Attorney General and Comptroller General of Brazil signed a leniency deal with Odebrecht in the multi-billion dollar corruption investigation surrounding the construction conglomerate.

Reuters reports that the agreement includes a 2.77 billion reais fine, equivalent to more than US$700 million, which will be taken from the US$2.39 billion fine that Odebrecht agreed to last year.

“This agreement allows us to move toward a return to more sustainable growth,” Odebrecht Chief Executive Luciano Guidolin said in a statement.

The deal will allow Odebrecht to more easily pursue public contracts said Comptroller General Wagner Rosario.

The announcement comes after the state-owned oil company Petrobras announced that it would start doing business with Odebrecht. That decision came after the board of directors of Petrobras concluded that Odebrecht “adopted measures to prevent, detect and remediate acts of corruption and fraud.”

According to the United States Justice Department, Odebrecht spent more than US$800 million in bribes in 10 Latin America countries which resulted in nearly US$2.4 billion in ill-gotten gains, typically in the form of construction contracts.

Between 2001 and 2016 Odebrecht spent US$439 million in bribes in Brazil which resulted in US$1.4 billion in gains.

Brazil’s Petrobras Can Once Again Do Business with Odebrecht

The Brazilian construction conglomerate Odebrecht SA will be allowed to do business with Brazil‘s state-owned oil firm, Petróleo Brasileiro SA.

According to Reuters, the board of directors at Petrobras “lifted restrictions on doing business with certain units of the engineering firm Odebrecht SA” after the conglomerate “adopted measures to prevent, detect and remediate acts of corruption and fraud.”

Both Petrobras and Odebrecht have been the center of multiple corruption scandals in recent years. Over the course of more than a decade, Odebrecht engaged in systematic corruption in a dozen countries in Latin America and Africa.

According to the United States Justice Department, Odebrecht spent more than US$800 million in bribes in 10 Latin America countries which resulted in nearly US$2.4 billion in ill-gotten gains, typically in the form of construction contracts.

The Justice Department report found that between 2010 and 2014 US$10.5 million in bribes were made in Mexico resulting in US$39 million in benefits for Odebrecht.

In April 2018, the Mexican government banned federal and state governments from doing business with Odebrecht for two and a half years.

Venezuela’s Former Prosecutor General Accuses Maduro of Corruption

The former Prosecutor General of Venezuela, Luisa Ortega Díaz, accused President Nicolás Maduro of corruption related to the Brazilian construction conglomerate, Odebrecht. Odebrecht is at the center of a multi-billion dollar corruption investigation across Latin America.

Ortega Díaz served as Prosecutor General for a decade between 2007 and 2017. She was fired in August 2017 by the National Constituent Assembly, a legislative body created by Maduro to bypass the democratically elected and opposition-controlled National Assembly. Two weeks after she was fired, Ortega Díaz fled Venezuela for Colombia.

Towards the end of her tenure, Ortega Díaz was one of the few members of the government who openly spoke out about Maduro’s growing authoritarianism.

Ortega Díaz presented 18 principle pieces of evidence and 46 digital annexes as proof of Maduro’s crimes. She said that the evidence she delivered to the Court leaves no doubt “that Maduro is involved in corruption with Odebrecht.”

She added: “He is corrupt and a thief who has appropriated the money of the Venezuelans.”

“These tests must be exhibited so that the world knows how Nicolás Maduro and this band of criminals who occupy Miraflores stole Venezuelan money, which should have been destined for food and medicine. One of the troubles that Maduro had for assaulting the Public Ministry was to destroy this file; fortunately, we managed to preserve it,” said Ortega Díaz.

This is not the first time that Ortega Díaz has presented evidence against her former boss before the Supreme Court in exile.

In April 2017 Ortega Díaz presented documents which she claimed showed that Maduro engaged in corruption while in office. The Miami Herald reported at the time that one of the chief accusations was that Maduro received US$35 million in illegal campaign contributions from Odebrecht in return for construction contracts.

Mexico Bans Odebrecht from Government Contracts

Federal institutions and state governments in Mexico are banned from doing business with Odebrecht for two and a half years, the government announced in its official journal.

The Brazilian construction conglomerate admitted guilt in late-2016 to a massive bribery scheme throughout Latin America and Africa. The Odebrecht corruption scandal was uncovered by prosecutors in Brazil, the United States, and Switzerland.

A report by the United States Justice Department found that between 2010 and 2014 Odebrecht officials gave $10.5 million in bribes in Mexico. As a direct result, Odebrecht reaped nearly $40 million in benefits.

Peru Prosecutors Conduct Raids Related to Odebrecht Corruption Scandal

The homes of Susana Villarán, the former mayor of Lima, and José Miguel Castro, her former political ally and Municipal Manager of Lima, were raided last week, according to the Public Ministry of Peru.

“Prosecutors Hamilton Castro and Luis Ballón are at the home of Susana Villarán and Prosecutors Sergio Jiménez and Marcial Paucar at the home of José Miguel Castro. The prosecutors are in charge of prosecutor Castro who leads the Special Team,” the Public Ministry said in the tweet on April 5th.

The two are suspected of accepting bribes from Odebrecht, a Brazilian construction conglomerate, and its subsidiary during their time in the municipal government.

In another tweet, the Public Ministry said that the investigation is four months in the making.

“The investigation against the ex-mayor Susana Villarán has so far 4 months of preliminary investigation and is the case that more testimonial statements have been received, said the Special Team spokesman, prosecutor Óliver Chávez,” said the Public Ministry in a tweet on Tuesday.

In the order authorizing the raid, Judge Manuel Antonio Chuyo Zavaleta said that Villarán and Castro “solicited and received” campaign donations from Odebrecht and its subsidiary in return for government contracts.

Excerpt from the order to raid the homes of Susana Villarán and José Miguel Castro / Screenshot taken April 11, 2018
Excerpt from the order to raid the homes of Susana Villarán and José Miguel Castro / Screenshot taken April 11, 2018

Prosecutors say Villarán and Castro received $3 million from Jorge Barata, a former Odebrecht executive who has admitted that he participated in bribery. For more than a decade, Odebrecht systematically bribed politicians across Latin America in order to secure government contracts. Officials admitted in 2016 to spending $800 million in bribes in 10 countries in Latin America and the Caribbean, including in Peru.

According to El Comercio, Barata said that he was in a meeting with Castro during his time in the Lima municipal government.

However, Castro denies the accusations of corruption.

“I have never received any money, specie, transfers or any payment either from Mr. Barata, or any of the companies related to him or with the Odebrecht group,” said Castro.

The raids come just weeks after former President Pedro Pablo Kuczynski resigned the presidency after allegations of corruption arose against him. Commonly known by his initials, PPK barely survived impeachment earlier this year and was expected to be removed by Congress if he did not step down.

PPK was replaced by his first vice president and then-ambassador to Canada, Martín Vizcarra, on March 23, 2018.