Petrobras graft scandal: Agents of S'pore firms accused of paying $13m

Petrobras graft scandal: Agents of S'pore firms accused of paying $13m

The corruption scandal engulfing Brazilian oil giant Petrobras has further embroiled both Keppel Corp and Sembcorp Marine, with allegations that US$9.5 million (S$13 million) in bribes were paid by agents of the two Singapore companies.

The money was allegedly paid to officials of Petrobras, its unit Sete Brasil and Brazil's Workers' Party to procure 12 contracts to build drillships.

United States court documents obtained by The Straits Times cited plea statements and testimony given to Brazilian authorities - in their probe, Operation Car Wash - by Pedro Jose Barusco Filho, a former Petrobras executive, on the scope and duration of Brazil's biggest corruption scheme at the national oil company.

In exchange for leniency, Barusco and two other former Petrobras officials also agreed to disgorge US$100 million in bribes they received.

Keppel and SembMarine have strongly denied allegations that they paid bribes.

When asked last week, Keppel said it was unable to comment further at this stage.

In an earlier statement, it said it "denies these baseless allegations and will vigorously defend the action".

SembMarine said it was unable to comment as legal proceedings are ongoing, nor was it able to comment on allegations connected with Barusco.

"The group has a strict anti-bribery policy and does not condone any action that will result in the violation of any country's anti-corruption laws. It also does not, and will not, tolerate any improper business conduct," its spokesman said.

According to the lawsuit by fund manager EIG Management, Sete Brasil, a drilling rig charterer, was installed with "Petrobras cronies" to "perpetuate a corruption scheme that had already been in place" at Petrobras.

Sete solicited funds from EIG and other investors and used those funds to "generate contracts that in turn facilitated the payment of bribes and kickbacks by the shipyards".

The contract bidding process "was rigged from the start", EIG alleged in the suit, which named as defendants Petrobras and seven others, including Keppel and its unit Keppel Offshore and Marine, Sembcorp Industries, SembMarine and its unit Jurong Shipyard.

It alleged that the defendants, through agents, agreed to pay bribes and kickbacks, in exchange for contracts, to a former treasurer of the Workers' Party, two Petrobras officials and to executives of Sete Brasil, including Barusco, who was one of its most senior executives.

When the scheme was exposed in 2014, it led to the bankruptcy of Sete Brasil in April this year, and rendered EIG's investment of more than US$221 million "worthless", the suit said.

Barusco, in plea statements, named Zwi Skornicki, an agent of Keppel in Brazil, and Guilherme Esteves de Jesus, an agent of Jurong Aracruz shipyard, which is owned by Jurong Shipyard, for their involvement in the bribery.

According to Barusco, Skornicki allegedly paid at least US$4.5 million in bribes on behalf of Keppel's BrasFels shipyard for six contracts with Sete Brasil, while de Jesus allegedly paid at least US$5 million in bribes on behalf of Jurong Aracruz for six contracts.

In addition, Barusco allegedly negotiated an additional bribe for himself from both shipyards in the amount of 0.1 per cent of the contract value, court papers said.

Skornicki had been arrested for paying over US$10 million in bribes between 2003 and 2013, and another US$4.5 million between 2013 and 2014, while de Jesus had been arrested and charged last year with corruption, embezzlement and money laundering by Brazilian prosecutors.

He is alleged to have passed at least US$8.2 million in bribes to Petrobras executives, the suit said.

Brazilian prosecutors are investigating the alleged involvement of Keppel, Keppel Offshore, SembIndustries, SembMarine and Jurong Shipyard, the suit added.

This article was first published on June 14, 2016.
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