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Odebrecht Pleads Guilty to Bribery in Brazilian Car Wash Probe

23 December 2016

Countries involved include Angola, Argentina, Colombia, Dominican Republic, Ecuador, Guatemala, Mexico, Mozambique, Peru, Panama, and Venezuela.

On Wednesday, Odebrecht pleaded guilty to a one-count criminal information filed by the Criminal Division's Fraud Section and the U.S. Attorney's Office in the U.S. District Court for the Eastern District of NY, charging the company with conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act.

In a plea deal, Odebrecht admitted to having paid $788 million in bribes to government employees.

The almost three-year "Car Wash" investigation, named for a Brasilia gas station where some of the alleged money laundering took place, also contributed to the downfall of Brazil's former president, Dilma Rousseff.

The company is at the center of the mushrooming probe at state-run oil giant Petrobras, which has ensnared Brazilian politicians and business people across the board.

Among those charged have been former Brazilian President Luiz Inacio Lula da Silva, who Brazilian prosecutors say oversaw a scheme in which Odebrecht paid 75 million reais ($22.18 million) in bribes to win eight Petrobras contracts.

It became the region's largest engineering conglomerate, building parts of a road across the Amazon jungle, tunnels and subways in major cities.

"Braskem's misconduct was exposed through the investigative work of authorities in three countries". The Brazilian contractor paid the bribes to politicians in 12 countries over the last 15 years.

The SEC appreciates the assistance of the Department of Justice Criminal Division's Fraud Section, the Federal Bureau of Investigation, the Brazilian Federal Prosecution Service, the Brazilian Federal Police, and the Office of the Attorney General in Switzerland.

"S&N was used by Odebrecht to carry out the bribery scheme, hide and mask improper payments made to benefit foreign public servants and political parties in many countries", declares the DOJ document.

The companies pleaded guilty in the USA federal court in Brooklyn to conspiring to violate a U.S. foreign bribery law after an investigation involving political kickbacks and Brazil's state oil company, Petrobras.

The Justice Department called it the largest resolution ever under the Foreign Corrupt Practices Act, a 1977 law that makes it illegal to bribe foreign government officials for business.

But if the settlement, which was negotiated in Brasilia, had been announced in Brazil, its legal system would have required that details remain sealed and not disclosed to the public, two sources close to the negotiation told Reuters on Thursday.

"The message sent by this prosecution is that the United States, working with law enforcement partners overseas, will not hesitate to hold responsible those corporations and individuals who seek to enrich themselves through the corruption of the legitimate functions of government, no matter how sophisticated the scheme", Capers concluded.

Earlier this month, the company apologized for its involvement in corruption scandals that led to the arrest of its former chief executives and several of its officials. On the other hand, says the DOJ, Odebrecht "obtained benefits of approximately USA $ 261.7 million as a result of these corrupt payments" only in that country.