Brazil bars Mendes Junior from govt. tenders in Petrobras scandal

BRASILIA,  (Reuters) – Brazil’s comptroller general said it had barred builder Mendes Junior Engenharia from public tenders for at least two years yesterday, making it the first engineering company to be penalized for involvement in the Petrobras corruption scheme.

While a dozen other engineering companies have come forward to negotiate leniency deals with the comptroller general’s office, Mendes did not do so by the deadline last year.

The company will be banned from contracting work with federal, state and municipal governments.

Mendes is one of about 30 companies implicated in the bribery and kickback investigation that began two years ago and has ensnared dozens of politicians, including the speaker of the lower house of Congress Eduardo Cunha, and added to pressure to impeach President Dilma Rousseff.

The graft scheme involved engineering firms that siphoned off money from over-priced contracts with state-run oil company Petroleo Brasileiro SA, as Petrobras is formally known. The money was used to bribe Petrobras executives and provide kickbacks to politicians in Rousseff’s governing coalition.

The blacklisting of these companies by Petrobras has led to bankruptcies of builders and their suppliers, and the laying off of thousands of workers, contributing to the Brazil’s worst recession in a century.

Negotiating leniency settlements with the comptroller general’s office, known as the CGU, would allow companies to bid for future government contracts in return for admission of guilt, reparation of financial damages and payment of fines.

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