The U.S. Department of Justice and the Securities and Exchange Commission have opened investigations into Brazil’s Petrobras for violations of the Foreign Corrupt Practices Act (FCPA), the Financial Times said Monday.

The DOJ is pursuing a criminal investigation and the SEC is undertaking a civil investigation into alleged bribery, the FT said.

Neither agency has disclosed details about the investigation or the allegations.

Petrobras has not commented on the investigations.

The state owned company is currently embroiled in corruption and graft investigations in Brazil.

Former downstream head Paulo Roberto Costa has alleged that funds from the company were used for illegal political campaign financing, including campaigns run by Petrobras transportation chief Sergio Machado.

Machado, a member of Brazil’s Democratic Movement Party, has denied Costa’s allegations.

Public prosecutors have already recommended that Machado be removed from his position at Transpetro, Petrobras’ transportation arm.

Costa is currently awaiting trial for allegedly participating in a $3.96 billion money laundering scheme.

In September, Costa admitted to taking a $636,000 bribe in connection with the state-owned company’s 2006 purchase of a Texas refinery.

Police raided the company’s offices in April after Costa claimed corrupt practices were common during his tenure at the company.

The company has hired two law firms to help it investigate corruption, money laundering and bribery allegations against key executives.

Brazilian newspaper Folha de Sao Paulo reported that at least 49 deputies, 12 senators and several state governors were involved in the bribery and kickbacks.

Police are also investigating $20 billion in transactions between Petrobras and construction firms involved in the company’s Abreu e Lima Refinery near Recife, Brazil.

In March, Brazilian prosecutors began looking into allegations that Petrobras employees took $139 million in bribes from Netherlands-based supplier SBM Offshore in exchange for equipment supply and drilling contracts.


Leave a Reply