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Brazilian Police Arrest Executives Involved in Petrobras Scandal

11/14/2014 - 15h30

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FROM SÃO PAULO
FROM BRASÍLIA
FROM RIO
FROM THE SPECIAL EVOY TO CURITIBA

The Federal Police arrested this Friday (14) Renato Duque, former Director of services at Petrobras, and executives of the country's main building contractors suspected of paying bribes in exchange for contracts with the run-state oil corporation.

The action is part of Operation codenamed Lava Jato (Car Wash) started in March. It investigates money-laundering and kickback scheme.

The nine companies involved belong to seven groups. Altogether, their contracts with Petrobras are worth R$ 59 billion (US$ 23 billion), from 2003 to 2014.

The investigators suspect that part of these contracts was used to launder the money that paid for political campaigns and its politicians.

The Federal Police executed search and seizure warrants at these company's offices: Camargo e Corrêa, OAS, Odebrechet, UTC, Queiroz Galvão, Engevix, Mendes Júnior, Galvão Engenharia e Iesa.

Preventive and temporary detention warrants were issued for 27 people; 18 have already been executed. Six coercive hearings - that require a person to attend hearings and give evidence - have been conducted. Three more are expected.

Until noon today, the police had arrested, among others, Leo Pinheiro, President of the OAS; Agenor Mendeiros, OAS Managing Director for the oil and gas division; Ricardo Person, President of UTC/Constran; Gerson Almada, vice-president of Engevix.

The Federal Police also searched UTC/Constran president Richard Person's house, a partner of the black market money dealer Alberto Youssef in a hotel and a real estate development.

Mendes Junior Vice President, Sérgio Cunha Mendes, was not arrested, as previously reported by Folha. The police have not yet found him and negotiate his surrender with his attorneys.

A coercive hearing was conducted with Engevix president, Cristiano Kok, in Sao Paulo. However, he chose to remain silent and was released. John Auler, member of Camargo Corrêa Board of Directors, and Eduardo Leite, vice-chairman of the contractor, had arrest warrants issued.

Both executives worked on Youssef's behalf, according to his own testimony.

The Federal Police arrested an entrepreneur from Santos (Sao Paulo) in Recife. They also went to another businessman apartment at Boa Viagem district, South of Recife. His identity was also preserved.

The police intended to seize computers, hard disks and money, but nothing was taken. According to them "relevant" evidence was found.

They are all expected to be taken to the Federal Police headquarters in Curitiba until early night. The detainees' lawyers say there is no reason to keep them there.

Camargo Corrêa has the largest individual contract with Petrobras' Abreu e Lima oil refinery worth R$ 3.4 billion (US$ 1.3 billion). The money is said by prosecutors to be used for bribe payments.

The contractor is accused of political kickback through the Petrobras tube supplier Sanko Sider. Both companies deny wrongdoings.

Brazilian federal prosecutors expected President of Odebrecht Engenharia Industrial Márcio Faria, and Rogério Araújo, the director of the company, to be arrested. The request, however, was denied by federal judge Sergio Moro.

The Odebrecht executives were mentioned by Paulo Roberto Costa as his contacts in the building contractor. The company strongly denies having committed irregularities in contracts with Petrobras.

The bank accounts of the executives investigated -a total of R$ 720 million- (US$ 277 million) were blocked. Each account had up to R$ 20 million (US$ 7.7 million). The company's accounts were not affected, so their financial health was preserved.

POLITICIANS

The Federal police informed that politicians were not targets of today's action. The exception was Marice Corrêa de Lima, a João Vaccari Neto relative (treasurer of the Worker's Party), taken by the police for a coercive hearing. She was taken by the police to provide clarification.

Renato Duque, former Director of Services at Petrobras, nominated by former Chief-of-Staff Jose Dirceu, was arrested in Rio. He is pointed by prosecutors and the police officers as the main man in the Workers Party to organize the deviations of Petrobras resources.

According to Petrobras' Director Paulo Roberto Costa, Duque's staff deviated 3% of the money earned from each contract to the Workers Party (PT).

According to the Court of Audit of the Union, his staff took care of the services and the engineering projects bidding for works that were overcharged, as the Abreu e Lima refinery and Comperj (Rio de Janeiro petrochemical complex).

During an interview on Friday, the Federal Police reported that any plea bargains made by Youssef or another defendant, was considered during today's actions.

LOBBYIST

The lobbyist Fernando Soares, known as Fernando Baiano, who allegedly is the middle man at PMDB, is on Interpol's wanted list and on the national system of wanted and prevented. The Federal Police issued an arrest warrant, but was unable to locate the suspect of involvement in the state-run oil company scandal.

His lawyer, Mario de Oliveira Filho, could not say if his client will surrender to the police. "I can only say that Fernando lives in Rio de Janeiro. He is not abroad, as rumoured. We are in contact", he said.

With MARIO CÉSAR CARVALHO, LUCAS FERRAZ, FLÁVIO FERREIRA, NATUZA NERY, SAMANTHA LIMA, GABRIEL MASCARENHAS, RUBENS VALENTE and ALEXANDRE ARAGÃO

Translated by JULIANA CALDERARI

Read the article in the original language

Márcia Foletto/Agência O Globo
Petrobras's former director of engineering and services, Renato Duque, was among those detained
Petrobras's former director of engineering and services, Renato Duque, was among those detained

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