Executives from French engineering conglomerate, Doris Group, were charged with corruption for allegedly paying bribes to obtain advantages from state-owned oil company, Petrobras.
The Brazil Federal Court accepted this week a complaint by the Federal Public Ministry (MPF) against two executives of French company Doris Engineering and a former treasurer of the Workers’ Party (PT), in addition to two women who provided support to the party in Rio de Janeiro (RJ), involving contracts for engineering services on Petrobras platform ships.
In all, five defendants were charged with active, passive corruption and money laundering. The MPF’s request includes the conviction of the defendants with imprisonment, a fine for the embezzled amounts and for the damages caused to Petrobras, in addition to a request for the blocking of assets of R$7.3 million (approx. $1.4M)
The complaint reports that two senior executives at Doris Engenharia, a Brazil subsidiary of the French conglomerate Doris Group, used a financial operator to pay bribes to the then Executive director of Engineering at Petrobras, in exchange for obtaining contracts for the provision of engineering services for eight platform vessels of the state-owned company worth more than US$ 200 million.
In addition to the Petrobras manager, a former PT treasurer and the financial operator who brokered the scheme were also recipients of the agreed bribe. The bribe was initially transferred by Doris Engenharia executives through a fictitious contract with a financial operator’s consulting company, totaling R$3.6 million (approx. $692k). Subsequently, a portion of these amounts was transferred by the financial operator to the Petrobras manager through a deposit in an account kept in Switzerland.
The bribe destined to PT was paid through the execution of another fictitious contract, this time with the company Zaama, located in Rio de Janeiro, and controlled by two sisters associated with the former treasurer. After signing the contract, the scheme’s financial operator made 27 bank transfers between 2011 and 2014 to Zaama company accounts, totaling R$649.6 thousand.
The financial operator of the scheme and the former Petrobras manager signed an award-winning collaboration agreement with the MPF, confessed to the crimes committed, which took place from mid-2010 to 2015, and delivered supporting documents.
Corruption at Petrobras
Petrobras has been mired in a massive bribery scandal (” Lava Jato” or Operation Car Wash). For several years, Petrobras officials engaged in a staggering corruption scheme in which hundreds of millions in bribes where paid to Brazilian politicians. The bribes were paid through various schemes in collusion with Petrobras’ contractors and suppliers, while its books & records were falsified to defraud investors and regulatory bodies.
Operation Car Wash has been described as the biggest corruption scandal in the history of Brazil. Since Operation Car Wash began in March 2014 the investigations have resulted in more than a thousand warrants of various types, and several enforcement actions against corporations by different authorities. (One of them was previously here.) More than $5bn in illicit payments to company executives and political parties were uncovered. Billionaires were sent to jail, a former president was dragged to court and irreparable damage was made to the reputations of some of the world’s biggest companies.
The Car Wash scandal expanded to at least ten other countries.
In 2015, the Swiss Office of the Attorney General (“OAG”) froze $400 million of assets that were allegedly connected to corruption at Petrobras; some of these assets were returned to Brazil. More than 300 accounts at over 30 Swiss banks, owned by Petrobras executives, suppliers, intermediaries and foreign companies, have been allegedly used to facilitate bribe payments.
This latest MPF indictment demonstrates that Brazil has not lost its appetite for holding company executives personally liable, and just how vast and extraordinarily intricate the web of corruption has been at Petrobras.