Brazil's Odebrecht to Pay $50 Million to Charities Under Deal With Development Bank
05 September 2019 - 9:28AM
Dow Jones News
By Dylan Tokar
Odebrecht SA, a Brazilian construction conglomerate, will pay
$50 million in charitable contributions to resolve allegations of
bribery under a deal reached with a Latin American development
bank.
The payments will go to charities and nonprofit organizations
that operate in Latin America, the Inter-American Development Bank
said Wednesday.
Under the agreement, certain Odebrecht subsidiaries will also be
prohibited from bidding on bank-funded projects for varying lengths
of time, the IDB said.
Odebrecht representatives didn't immediately respond to a
request for comment.
The IDB settlement is the latest in a long series of setbacks
for
Odebrecht, one of the most high-profile targets of a landmark
corruption investigation into Brazil's state-controlled oil
company, Petróleo Brasileiro SA, also known as Petrobras.
Odebrecht and petrochemical company Braskem SA in 2016 struck
parallel agreements with authorities in three countries to pay up
to $4.5 billion, as part of the largest anticorruption settlement
in history. Braskem is partly owned by Odebrecht and Petrobras.
The settlements with U.S., Brazilian and Swiss authorities have
spawned corruption probes in other Latin American countries where
the two companies operate. Last month, Odebrecht filed for chapter
15 bankruptcy in the U.S. shortly after it filed for bankruptcy in
Brazil in June.
The IDB said its investigation revealed evidence of bribes paid
by Odebrecht during a contract for a hydroelectric power plant in
Venezuela and a highway rehabilitation project in the state of São
Paulo, Brazil.
Under the terms of the settlement announced Wednesday, Odebrecht
didn't contest the evidence, the IDB said. The company won't be
required to pay the $50 million in charitable contributions until
2024.
CNO SA, a subsidiary of Odebrecht, will be debarred from bidding
on IDB projects for six years, the IDB said.
Another subsidiary, Odebrecht Engenharia e Construção SA, will
be conditionally non-debarred for 10 years. Under a conditional
non-debarment, the subsidiary will be eligible to participate in
IDB-financed projects if it fully meets the conditions of the
settlement.
A number of other CNO and Odebrecht Engenharia subsidiaries were
also debarred or conditionally debarred under the settlement, IDB
said.
Write to Dylan Tokar at dylan.tokar@wsj.com
(END) Dow Jones Newswires
September 04, 2019 19:13 ET (23:13 GMT)
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