Wednesday, July 22, 2015
July 22, 2015 1:34 am
Petrobras prosecutors look overseas
Joe Leahy in São Paulo and Andres Schipani in Bogotá
An investigation into alleged corruption at Petrobras, the Brazilian state-owned oil company, is spreading internationally, with Portugal on Tuesday announcing that it will assist Brazil in the probe.
Portugal’s decision comes on top of US and Swiss probes and follows announcements in recent weeks by Peru, Colombia, Ecuador and Panama that they are also taking action in relation to the investigation.
ON THIS STORY
- Lula da Silva faces criminal inquiry
- Brazil police raid former president’s home
- Executives arrested in Petrobras probe
- Petrobras scandal ensnares power group
- Petrobras probe looks to dig up corpse
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- Petrobras corruption losses may be larger
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- Petrobras chief pledges investor focus
IN OIL & GAS
The office of Portugal’s attorney-general said on Monday that it had received a request from Brazilian authorities for assistance in the investigation into Petrobras, which is known as Operation Car Wash. The matter had been passed on to criminal investigators for “execution”.
“The request is secret and any steps that are being made or will be made cannot be disclosed,” the prosecutor’s office said.
Brazilian prosecutors are fanning out around the world in search of further evidence to implicate the scores of politicians and former Petrobras executives and contractors allegedly involved in the case.
They believe former company officials collaborated with contractors to extract kickbacks from the company and pay bribes to politicians, with investigators zeroing in on Odebrecht, Brazil’s biggest construction company, and one of its main multinationals.
This week police formally charged the head of the company, Marcelo Odebrecht, with corruption, while a court convicted three former executives of construction group Camargo Corrêa for involvement in Car Wash. It was the first time construction executives had been convicted.
Odebrecht has repeatedly denied any wrongdoing by itself or Mr Odebrecht. It launched a fierce attack on the police charge sheet released this week, particularly its use of personal notes seized from Mr Odebrecht during police raids on his home and office that are being used as evidence. “The federal police report again attributes distorted, out-of-context and illogical interpretations to his personal notes,” the company said.
The investigation into Odebrecht has led prosecutors to former President Luiz Inácio Lula da Silva, whom they accuse of illegal influence peddling on behalf of the construction company overseas in regions ranging from Europe to Africa.
Ex-president Lula da Silva did not ask me for any favours for any company. This didn’t happen and it wouldn’t happen, I’m convinced, neither on his part or mine
- Portuguese prime minister Pedro Passos Coelho
On Monday, Portuguese prime minister Pedro Passos Coelho was forced to deny a report in O Globo, a Brazilian newspaper, that Mr Lula da Silva had personally asked him to favour Odebrecht in a privatisation project in Portugal.
“Ex-president Lula da Silva did not ask me for any favours for any company,” said Mr Coelho. “This didn’t happen and it wouldn’t happen, I’m convinced, neither on his part or mine.”
Mr Lula da Silva vehemently denies wrongdoing while Odebrecht has said his actions were the normal advocacy conducted by national leaders on behalf of business in their countries.
Odebrecht has extensive operations throughout Latin America.
In June, Ecuador’s comptroller general, Carlos Pólit, announced audits of more than a dozen Odebrecht contracts, which include pipeline, aqueduct, hydroelectric and refinery projects as well as the expressway to Quito’s new airport.
In Colombia, Odebrecht has been awarded a contract for a $1bn dredging project on the Magdalena river and another for the second tranche of a $2bn highway.
Luis Fernando Andrade, who heads Colombia’s National Infrastructure Agency, said if Odebrecht was convicted of corruption related to its Colombian contracts, it would be banned from new Colombian government contracts.
In Peru, one of the country’s lead prosecutors, Hamilton Castro, is planning to visit Brazil’s southern city of Curitiba, the centre of the Car Wash investigation, to collect evidence on possible graft on a transcontinental highway project.
In Panama, the Panama City Metro has asked the comptroller’s office to conduct an audit of its line one project, which was jointly built by Odebrecht and Spain’s FCC. Separately, the attorney-general’s office said it had received a request for co-operation from Brazilian prosecutors.
Just before Mr Odebrecht’s arrest last month, the consortium was awarded a $1.8bn contract for a second metro line. And just 10 days after his arrest, his company was awarded a $537m contract for the urban renovation of the city of Colón.
Friday, July 17, 2015
Related LinksThe Chiquita Papers
“Did your fruit fund terrorists?” New Report Asks Why Chiquita Blocked 9/11 Victims Bill
Judge Rejects Chiquita’s Effort to Block Release of Documents on Terror Payments
The “Cost of Doing Business in Colombia”
Chiquita Sues to Block Release of Files on Colombia Terrorist Payments April 8, 2013
Documents Implicate Colombian Government in Chiquita Terror Scandal March 29, 2007
|Washington, D.C., July 17, 2015 - In an important victory for transparency and corporate accountability, a federal appeals court in Washington, D.C., has ruled that the U.S. Securities and Exchange Commission (SEC) should release to the National Security Archive some 9,257 pages of records produced by Chiquita Brands International to the SEC as part of an investigation of the company’s illegal payments to a Colombian terrorist organization, the United Self-Defense Forces of Colombia (AUC), a group responsible for egregious acts of violence during Colombia’s civil war.|
The National Security Archive is a non-governmental, pro-transparency organization and leading nonprofit user of the Freedom of Information Act (FOIA) located at The George Washington University in Washington, D.C.
Chiquita had argued that release of the records under FOIA would deny it a fair trial in a Florida case brought on behalf of the AUC’s victims. Today, a three-judge panel of the U.S. Court of Appeals for the D.C. Circuit unanimously rejected Chiquita’s argument, writing that, “Neither the [Securities and Exchange] Commission nor the district court hearing this reverse-FOIA action thought release would deprive Chiquita of a fair trial. We agree with them.”
“The court of appeals’ decision is an important victory for FOIA requesters and the public,” said Adina Rosenbaum, the Public Citizen attorney who represented the National Security Archive in the appeal. “The decision confirms that the government cannot withhold documents from the public just because they might be of interest to someone involved in litigation. A ruling for Chiquita would have created a huge exemption to the FOIA law, with far-reaching implications. The court did the right thing by rejecting Chiquita’s argument that these records are exempt from disclosure.”
The case began in November 2008, when the Archive filed a pair of FOIA requests with the SEC asking for records relating to SEC and Justice Department investigations of Chiquita’s Colombian subsidiary, Banadex, for violations including the illegal AUC payments. In 2007, Chiquita had pled guilty to charges of “engaging in unauthorized transactions” with the AUC, which was designated a global terrorist organization by the U.S. State Department in 2001.
The D.C. Circuit decision in the FOIA case clears the way for the release of 9,257 pages that Chiquita identified as the most sensitive records that it turned over to the SEC during the course of the investigations.
In April 2011, the Archive published some 5,500 pages of Chiquita’s records released by the Department of Justice in response to similar FOIA requests. Those records revealed that Chiquita benefitted from its transactions with both AUC “paramilitary” groups and insurgents from the FARC and ELN guerrilla groups. The records call into question the Justice Department’s determination, spelled out in the 2007 plea deal, that there was no evidence of a quid pro quo with the illegal groups.
“More than eight years ago, Chiquita became the first U.S. company to be convicted for engaging in transactions with a global terrorist organization,” said Michael Evans, senior analyst at the National Security Archive. “Finally the victims of AUC violence and the general public will get a look at what might be the most important document collection ever assembled on corporate ties to terrorism.”
Thursday, July 16, 2015
Sunday, July 5, 2015
Last updated: July 5, 2015 6:30 pm
Deutsche Bank in legal wrangle over Argentine bond issue
James Shotter in Frankfurt and Joseph Cotterill in London
Hedge funds are pursuing Deutsche Bank over its role in a bond issue by Argentina as the country’s smouldering dispute with holdouts over its 2001 default continues to entangle international lenders.
A group of funds, including NML Capital, a subsidiary of Paul Singer’s Elliott Management, and Aurelius Capital Management, filed a subpoena at a New York court two months ago after Argentina sold about $1.4bn so-called Bonar 2024 bonds in April.
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The German lender has not yet fulfilled the request for information in the subpoena and declined to comment on the matter. Deutsche Bank Argentina was one of the institutions that placed orders for the bonds on behalf of third party investors, according to people familiar with the situation.
The wrangle is the latest in a long series of disputes stemming from Argentina’s $100bn default in 2001. More than 92 per cent of bondholders accepted haircuts on their investments as part of debt restructurings in 2005 and 2010. But a small group of hedge funds, led by NML and Aurelius, is fighting for full repayment.
Last year the US Supreme Court affirmed a ruling by a New York district court judge that Argentina could not service other foreign debts without paying holdouts at the same time, leading its government to ultimately opt to default rather than negotiate a settlement.
The holdouts have demanded that Deutsche provide documents clarifying its role in the auction as well as other earlier offerings of Bonar 2024s.
The subpoena asks for documents showing whether there had been any effort to structure offerings of Bonar 2024s in such a way that would “avoid attachment, execution, or other legal process in aid of judgment or pre-judgment enforcement initiated by creditors of Argentina, or any remedy or relief that creditors of Argentina may seek”.
The filing also asks for information on whether there was any discussion about how the offering was affected by “any applicable laws, rules, or regulations, including but not limited to laws, rules or regulations governing foreign currency exchanges or transfers of securities”.
An earlier attempt by Argentina to issue at least $2bn of US dollar bonds under local law fell apart in February after Judge Thomas Griesa ordered JPMorgan and Deutsche, the two banks involved in the sale, to hand over documents on the “flow of funds” relating to the issue.
With little prospect of Argentina agreeing to talk to holdouts before presidential elections in October, the funds have pursued their litigation on other fronts.
In May, Aurelius Capital asked Judge Griesa to rule that Bonar 2024 bonds were “external indebtedness”, which would place them under the Supreme Court ruling restrictions.