Construction firm Odebrecht and its affiliates who are at the forefront of Brazil’s “Operation Car Wash,” corruption investigation, pleaded guilty to the U.S. federal court for breaking bribery laws on Wednesday.
Odebrecht, a Brazilian firm, along with its affiliate companies are expected to be hit with penalties totaling up to US$3.5 billion to the state governments of the United States, Switzerland and Brazil. The companies have been involved in Brazil's corruption investigation, labeled “Operation Car Wash,” into Petrobras, the country’s biggest oil company which is part-owned by the state.
Odebrecht Construction, Latin America’s largest construction company and Braskem SA, an affiliate petrochemical company which is owned in part by Petrobras, are part of a group of companies targeted in the investigation that has lasted for almost three years.
Prosecutors say that the corrupt companies benefited from billion of dollars worth of bribes and kickbacks with the heads of Petrobras for a number of construction projects. The scheme also included international money laundering spanning to the United States and Switzerland.
The United States is calling the case the largest foreign bribery case in history and sentencing will be scheduled for April 2017. Odebrecht agreed that it currently can pay US$2.6 billion in fines, while Braskem SA has agreed to pay another US$2.6 billion. Odebrecht's former CEO Marcelo Odebrecht is currently serving a 19-year sentence after being charged for corruption last year.
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The ongoing corruption scandal has filtered into the very heart of Brazilian politics. It has already uncovered widespread corruption and made at least 200 arrests. Former President Luiz Inacio Lula da Silva has also been targeted by the investigation.
Current coup-imposed President Michel Temer, according to Brazilian media received more than US$3 million from Odebrecht and a number of his ministers have resigned in the fallout of the scandal.
Temer ousted democratically-elected President Dilma Rousseff in a parliamentary coup earlier this year. Dilma at the time was accused of corruption for her involvement on the Petrobras board. Despite being cleared of charges by an independent investigator, she was ultimately ousted by the right wing.