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News > Latin America

Brazil's Odebrecht Admits Bribes Continued Months After Corruption Probe Began

  • Brazilian President Michel Temer and several of his top allies are embroiled in corruption scandals.

    Brazilian President Michel Temer and several of his top allies are embroiled in corruption scandals. | Photo: Reuters

Published 17 April 2017

Millions were given to governors and ministers, and President Temer believes some may resign over the ever-growing scandal. 

A former head of Brazil's fraud-plagued construction conglomerate Odebrecht has revealed that bribes and illegal campaign contributions continued to be paid even one year after the investigations were launched into the largest corruption scheme in the country, local media reported Monday.

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Emilio Odebrecht, former chairman of the Board of Directors of the firm, told prosecutors that he ordered the end of illegal payments only after the arrest of his son and then-president and CEO of the company, Marcelo Odebrecht, in June 2015.

At the time of the high-profile arrest, the corruption investigations known as Operation Car Wash — which have targeted dozens of business figures and politicians linked to bribery schemes in the state-run oil company Petrobras — already had been underway for a year and three months after the first phase began in March 2014.

The information is just the latest in a slew of revelations to rock Brazil over the past week as the Car Wash investigations broaden their reach to target more than 100 politicians embroiled in the scandal. The latest phase of the probe has been driven by testimonies from former Odebrecht executives and employees as part of a plea bargain deal to negotiate reduced sentences in exchange for information about how the company's fraud networks functioned.

Statements from Odebrecht officials revealed Monday that 12 governors received about US$16 million by the current exchange rate in illegal payments to their respective campaigns that were never disclosed to electoral authorities.

Leading the list is the governor of Rio de Janeiro, Luiz Fernando Pezao, who belongs to President Michel Temer's PMDB party and received US$6.5 million, which according to witness statements was about 45 percent of the total amount of money he declared he had received for his campaign.

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Marcelo Odebrecht also recently testified that some 75 percent of all election campaigns in Brazil received illegal, undeclared financing, which he said had created a "vicious cycle."

The news comes after eight of Temer's ministers, mentioned last week by Odebrecht executives as figures who had received kickbacks, are set to face investigations over fraud allegations.

Temer said Monday he expected some of his ministers to resign, but that he believed that wouldn't prevent his government from approving major economic reforms, such as the controversial labor and pension reforms currently under review.

"It is very likely that some ministers feel uncomfortable and think that they can't continue," said Temer during an interview with a local radio station.

Temer said the scandal was "embarrassing," but assured that he wouldn't fire any of his ministers before they are formally charged, which could take months or even years.

As part of plea bargain deal for 77 Odebrecht employees who have admitted to paying millions of dollars in bribes, officials agreed to present a list of politicians connected to the scheme in order to reduce their own sentences.

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