Editorial: The Petrobras Paradox

11/13/2014 - 08h55

If it was up to Brazilian politicians it would be very difficult for an investigation over corruption claims at Petrobras to be carried out with the boldness that this subject requires.

Amongst a countless number of congressmen, governors and former ministers, in addition to large political campaign donors, the political kickback scheme found its shelter beneath the power of those it serves.

Instead of encouraging thorough scrutiny, the sheer scale of the case seemed to be the biggest obstacle to its resolution.

This paradox began to be unveiled after two awards were given to whistleblowers.

While both the opposition and the current government insist on the fringe theater performed by the parliamentary commission inquiry - created first and foremost to please the public than to enlighten it - two central characters decided to tell the Court what they know.

In exchange for lighter punishment, Paulo Roberto Costa, former director of Supplies at Petrobras, alongside currency changer Alberto Youssef, described the whole plunder.

The equivalent to 3% of all deals made by the public company went to the Brazilian Workers' Party (PT), The Progressive Party (PP) and the Brazilian Democratic Movement Party (PMDB).

If politicians and staff have taken advantage of bribes, so have private companies that partook in these corrupted dynamics by signing lavish deals with Petrobras. Everyone is a winner.

Once the bribes came to light many realized how much they had to lose - starting with Dilma Rousseff's government (PT), which, in addition to worrying about inner party damage, also fears eventual harms to the image of Brazil's largest public company.

According to the Financial Times, the haggling that went on at Petrobras is under investigation by the American Department of Justice and by SEC (Securities and Exchange Commission), the main agency to regulate the market in the USA.

Authorities from these countries are assessing an alleged violation to an American anti-corruption law that has either taken place overseas or has been carried out by companies that, like Petrobras, have shares in American stock markets.

The government has assessed that, depending on what is found by these bodies, the impact on the company's business and investment with foreign partners may be negative.

In this setting, the purging at Petrobras cannot be staged.

Explanations of the strategies employed for diverting money will need to be convincing enough for international agents who have little empathy for the interests of Brazilian politicians.

Translated by CRISTIANE COSTA LIMA

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