Brazil graft probe could ensnare Eletrobras, foreign firms -prosecutor

CURITIBA, Brazil, (Reuters) – Brazil’s biggest corruption investigation could spread to its largest electric utility, Eletrobras, and more than a dozen foreign companies, a lead prosecutor said yesterday, in a sign of further turbulence for the country’s business and political establishment.

Carlos Fernando dos  Santos Lima
Carlos Fernando dos
Santos Lima

Carlos Fernando dos Santos Lima said a scheme similar to one set up as state-run oil firm Petrobras may have operated at Eletrobras, specifically on major projects like nuclear reactor Angra 3 and the $13 billion Belo Monte hydroelectric dam in the Amazon.

In a wide-ranging interview, the Cornell University educated prosecutor said “there are many charges still to come,” in a probe likely to continue for at least another two years.

The groundbreaking inquiry has already ensnared dozens of senior executives, battered the popularity of President Dilma Rousseff and rattled the fragile Brazilian economy.

The 16-month-old investigation has also turned up evidence of corruption by more than a dozen foreign firms, including South Korea’s Samsung Heavy Industries Co Ltd, Swedish builder Skanska AB, Danish oil and shipping group Maersk and British engineer Rolls-Royce Holdings, Lima said.

He called an estimate of $2.1 billion worth of bribes moved in the scheme “conservative.”

By investigating another state-controlled company and including so many foreign Petrobras suppliers, the prosecutors have extended the scope of an investigation that claimed one of its biggest scalps yet with the arrest of the chief executive at construction and engineering conglomerate Odebrecht SA.

Lima has said he has no doubt that Odebrecht and rival construction company Andrade Gutierrez led a “cartel” that overcharged Petrobras for work and passed on the excess to executives and politicians.

The prosecutors have charged executives with corruption and money laundering but not yet for forming a cartel they say began 10 or 12 years ago. Odebrecht denies participating in a cartel and has called the arrests illegal. Prosecutors must present charges within 30 days of arrest. Lima said his task force is not investigating former President Luiz Inacio Lula da Silva’s ties to Odebrecht’s CEO Marcelo Odebrecht, as some Brazilian media have suggested could happen.

“At this point the former president is not part of the investigation,” said Lima. “All we have until now is just news in the press … The fact is, if we find cause, we will investigate him like anyone else.”

Lima also said lawyers for Odebrecht and other executives arrested on Friday have not offered any signs of interest in plea deals, a key driver in widening the investigation so far.

“If someone from Odebrecht were to decide to collaborate, who knows we might get some information on the political end as well,” Lima said

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