The company has now agreed to pay a record $3.5 billion penalty after being accused of paying $439 million to politicians, political parties and government workers in at least 12 countries in exchange for public works contracts.
Some of the countries where Odebrecht bribed officials include Argentina, Brazil, Colombia, Dominican Republic, Ecuador, Guatemala, Mexico, Panama, Peru and Venezuela.
The company, which has 128,000 employees and gross annual revenue of $40 billion, plays a pivotal role in the corruption scheme uncovered by Operation Car Wash (Lava Jato in Portuguese). Since 2014, investigators have been picking apart a complex and longstanding web of kickbacks at the state-owned oil company Petrobras.
Peter Hakim, Inter-American Dialogue chairman
Odebrecht had been signing contracts with Petrobras since the 1950s. It took investigators over a year to find the first pieces of evidence, and these led to Marcelo Odebrecht, CEO and grandson of the company founder, who was sentenced to prison in June 2015.
As the probe proceeds, the company has become a very real threat to representatives of political power across Latin America: presidents, former presidents and congress-members in various countries have already been named by company officials anxious to cooperate with the justice system in order to become eligible for sentence reductions.
Odebrecht’s CEO and a team of 77 top executives have negotiated deals in exchange for information. Marcelo Odebrecht was sentenced to 19 years for crimes ranging from money laundering to criminal association. The company agreed on a settlement deal to end proceedings in the US, Brazil and Switzerland.
The US State Department has yet to divulge the names of any authority outside Brazil involved in the scandal, but prominent figures are widely expected to be on the list.
Odebrecht has admitted to paying $29 million in bribes to Peruvian government workers between 2005 and 2014. This covers the period under three presidents: Alejandro Toledo (2001-2006), Alan García (2006-2011) and Ollanta Humala (2011-2016). In February of last year, Humala was named as a recipient of $3 million in bribes from Odebrecht. The former leader has denied the charges.
In Panama, there is speculation that one of the beneficiaries of the kickbacks is Luis Enrique Martinelli Linares, one of the sons of former president Ricardo Martinelli (2009-2014). Both men have also denied the charges.
In Argentina, officials in the Cristina Fernández de Kirchner administrations are thought to have accepted over $35 million in connection with three infrastructure projects between 2007 and 2014.
And in Venezuela, whistleblowers have mentioned a $3 million contribution to the campaigns of the late Hugo Chávez and the current president, Nicolás Maduro.
In every country, the operating system was the same: Odebrecht used a sophisticated network of offshore firms to pay the bribes. On the Caribbean island of Antigua, it even purchased a local bank to make the transactions easier.
Authorities say that Odebrecht used different “layers of money laundering” to hide its tracks. The payments to government officials were made from the company’s Structured Operations Sector, which came to be known as the “bribes department.” It had a parallel accounting system, backed the funds and authorized the transfers with oversight from the CEO himself.
The US State Department has yet to divulge the names of any authority outside Brazil involved in the scandal
News about the settlement deal saw authorities in the nations involved react swiftly. Prosecutors in Argentina, Peru, Colombia, Panama and Ecuador have announced their own bribery investigations. In Mexico, the government and the oil company Pemex said they will also investigate the matter.
But the documentation released by the US justice system could well be just the tip of the iceberg of this international corruption scheme.
English version by Susana Urra.