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News > Peru

Peru: Odebrecht Cuts Plea Deal, Pays Fine, Continues Contracts

  • Logo of the Odebrecht construction company in Sao Paulo, Brazil. The company reached a Peru plea deal to continue working in the country Aug. 3, 2018.

    Logo of the Odebrecht construction company in Sao Paulo, Brazil. The company reached a Peru plea deal to continue working in the country Aug. 3, 2018. | Photo: Reuters

Published 9 December 2018

As part of the plea, Odebrecht officials are now obliged to hand over evidence related to open investigations regarding the construction company's bribe program. 

Odebrecht’s Peru office agreed to pay authorities a multimillion-dollar fine in order to continue operating in the country. In exchange, the Brazilian construction company will provide evidence about officials it bribed, including two former Peruvian presidents.

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Reuters says the fine will amount to up to US$200 million to be paid over 15 years. In negotiations with the public prosecutor's office, Odebrecht executives agree to admit to paying bribes to win at least four major construction projects to escape any future criminal convictions in relation to these Peru contracts. Odebrecht will also be able to continue operating in the country but may face charges if evidence of further corruption appears.

Odebrecht is still obligated to collaborate in any investigations carried out by Peru prosecutors regarding the far-reaching Lava Jato (Car Wash) corruption scandal in the country. The entire investigation, first revealed in 2014 has uncovered that over the previous 20 years, the Brazilian company paid upwards of US$9.3 billion to Latin American authorities and elected officials, including former Peru president, Alan Garcia, in exchange for public works contracts.

Garcia is accused of favoring Oderbrecht in the construction of a Lima public transit initiative during his last presidential term (2006-2011). In exchange, prosecutors say the former leader accepted US$100,000 in kickbacks. Recently, the ex-president was denied asylum in Uruguay where he sought to escape to before imminent charges were brought against him in the case.

After Brazil, Peru has seen the greatest fallout from the Odebrecht scandal. All four of its most recent former presidents are under investigation in connection to illicit negotiations with the company. Former presidential candidate, Keiko Fujimori was recently placed under 36-month preventative detention while prosecutors investigate evidence that links the legislator to accepting illegal campaign finances from the construction business.

Prosecutors say Odebrecht also paid off former president Alejandro Toledo about US$20 million to construct parts of the Interoceanic Highway Corridor Peru-Brazil.

“The 15 years’ time frame was established for the payments because Odebrecht is technically bankrupt,” a source told Reuters.

As part of the plea, Odebrecht Peru officials are now obliged to hand over evidence related to the "My Web Day" and "Drowsy" investigations regarding the construction corporation where further evidence of bribes exists but not yet recognized by the ex-directors of the construction company.

Odebrecht recognizes the payment of bribes in four projects carried out in Peru: the Interoceanic Highway in the government of former President Alejandro Toledo, the Lima Metro in the second government of Alan García, Costa Verde Callao with the regional governor Felix Moreno and Vía Circunvalación-Cusco with the former governor Jorge Acurio Tito.

If Peru discovers another illegal act, Odebrecht can be convicted.

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