US and Brazilian authorities have fined Brazil’s state oil giant Petrobras more than $853 million for covering up bribes to Brazilian politicians and political parties, the US Justice Department announced Thursday.
Petrobras executives at “the highest levels,” including board members, orchestrated hundreds of millions in bribes “and then cooked the books to conceal the bribe payments from investors and regulators,” US Assistant Attorney General Brian Benczkowski said in a statement.
Brazilian authorities will receive 80 per cent of the fine, with the remainder will be collected by the Justice Department and the Securities and Exchange Commission.
The actions the company admitted to occurred while Petrobras was traded on the New York Stock Exchange, giving US authorities jurisdiction over the alleged crimes, the Justice Department said.
Prosecutors say a Petrobras executive directed payments to stop a Brazilian parliamentary inquiry into company contracts.
The executive also allegedly funneled bribes from company contractors into the campaign of an unnamed Brazilian politician who had power over where Petrobras could build refineries.
Petrobras admitted some executives funneled payments to politicians and political parties, and that the company failed to keep accurate books and records about property and equipment, as required by law.
Executives also falsely certified Petrobras financial statements to the US Securities and Exchange Commission even while they were personally involved in the bribery.
“According to Petrobras’s admissions … members of the Petrobras Executive Board were involved in facilitating and directing millions of dollars in corrupt payments to politicians and political parties in Brazil, and members of Petrobras’s Board of Directors were also involved in facilitating bribes that a major Petrobras contractor was paying to Brazilian politicians,” the statement said.
As part of the agreement announced Thursday, Petrobras agreed to continue cooperating within any continuing investigations into the matter, including actions taken by individuals, and to make changes to its internal compliance program.
The settlement announced Thursday involved a “non-prosecution agreement,” meaning no charges will be brought against the company. Prosecutors may separately take action against individuals.
More than 40 countries including the United States have criminalized paying bribes abroad to win business, which authorities say defrauds investors while promoting corruption and political instability.
In a related matter, Petrobras agreed to pay $933.5 million to the SEC to return ill-gotten gains, but this sum will be reduced by the amount of any payments made in a class-action lawsuit by investors filed in New York.