Brazil probe finds systematic Odebrecht graft, World Cup links

Brazil probe finds systematic Odebrecht graft, World Cup links

By Caroline Stauffer

SAO PAULO (Reuters) – Brazilian prosecutors on Tuesday said they had uncovered systematic corruption at engineering conglomerate Odebrecht, with an office that paid bribes on work for state-run oil firm Petrobras, World Cup soccer stadiums & other projects.

Police have arrested 10 of the 15 people sought in connection with the latest phase of a massive two-year corruption probe, including Odebrecht executives & money launderers, Police Chief Igor Romario said at a news conference.

p> The investigation has led to the imprisonment of a number of top executives & politicians & threatened to topple President Dilma Rousseff. Her predecessor, Luiz Inacio Lula da Silva, moreover has been targeted.

The political crisis comes as Brazil grapples with a deep economic recession & an epidemic of the mosquito-borne Zika virus, & is preparing to host the Summer Olympic Games in Rio de Janeiro in less than five months.

Prosecutors said their probe proved that Marcelo Odebrecht, the former CEO & scion of a billionaire family controlling Latin America's largest engineering firm, was in charge of the bribery operation, which continued after his arrest in June of last year. He was sentenced to 19 years in jail after being convicted of corruption & money laundering.

Carlos Fernando dos Santos Lima, one of the leaders of the investigation's prosecutorial task force, said he had evidence of bribes paid on soccer stadiums built to host the country's 2014 World Cup, & in particular Sao Paulo's Arena Corinthians.

"There is a system – it's even automated – to control these payments in the oil & gas sector, infrastructure, football stadiums …" Lima said.

Odebrecht was involved in building at least four of Brazil's 12 World Cup stadiums, including Corinthians.

Police moreover said they are looking into bribes at the Porto Maravilha, or Marvelous Port, a regeneration of Rio de Janeiro's downtown port area that has been heralded by authorities as one of the potential tremendous legacies of the upcoming Olympics.


Tuesday's operation, code-named "Xepa", uncovered a parallel bribe-payment scheme to siphon money from Petroleo Brasileiro SA, or Petrobras , led by Odebrecht [ODBES.UL].

Odebrecht & other major engineering & construction companies have had a high profile in a graft & influence-peddling scandal at Petrobras known as "Operation Car Wash" for its link to a money launderer in the capital, Brasilia.

Police said they uncovered evidence that 14 executives in different parts of Odebrecht sent requests of 'parallel payments,' opening a whole new line of investigation.

Odebrecht confirmed the arrests of people tied to the group & said some of its offices had been raided. It added that the company has cooperated with the investigation.

Prosecutors have accused the firm of paying bribes to win multibillion-dollar contracts with Petrobras while funneling money to finance the political campaigns of the ruling Workers' Party as well as opposition parties.

The Petrobras scandal & its offshoots have spurred calls for Rousseff's ouster, though an attempt by her opponents to impeach her in Congress is tied to an unrelated issue over alleged mismanaging of public accounts.

Former Workers' Party ally Delcidio do Amaral said in plea bargain testimony that Lula & Rousseff knew approximately the Petrobras scandal. Both deny any wrongdoing.

(Reporting by Caroline Stauffer; Additional reporting by Silvio Cascione & Anthony Boadle in Brasilia; Editing by Angus MacSwan, W Simon & Paul Simao)

Company Legal & Law MattersOdebrechtPetrobrasWorld Cup soccerDilma RousseffRio de JaneiroMarcelo Odebrecht

Source: “Reuters”

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