Updated 06:12 PM EDT, Fri, Jun 05, 2020

Brazil Looks Into 21 Companies Linked to Petrobras Scandal

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Fueled by contract-fixing allegations at the state-run multinational energy corporation Petrobras, Brazil's antitrust body has started investigating 21 companies and 59 high-ranking officials who are believed to have been involved in an estimated $9 billion worth of contracts.

An Associated Press report published by Huffington Post said these probes came after similar investigations into alleged kickbacks and bribes at the energy corporation, which put involved politicians and businessmen behind bars.

Once found liable for the contract-fixing charges, the same report said that companies will not be included in public biddings.

Infobae mentioned that the investigation was opened by the Administrative Council for Economic Defense (CADE), which is the tool to fight monopolies and "defense of free competition of the Ministry of Finance."

The same report also said that some of the defendants in the case have already been convicted for criminal offenses they committed, in an effort to divide the contracts of Brazil's biggest company.

This latest scandal in the country is believed to have brought to light the wrongdoings of the largest company in Brazil, involving fifty legislators and politicians like Senate president and the Chamber of Deputies head, noted Infobae.

"The same executives now have to respond in an administrative process that may entail significant fines," added the same report.

The CADE claimed that the contracts involved in the fraudulent acts involved construction projects of refineries in various parts of the country like Sao Jose dos Campos, Araucaria, Paulinia and Abreu e Lima, and even the Petrochemical Complex of Rio de Janeiro.

"There is robust evidence that companies and individuals under investigation have concluded agreements with the aim of fixing prices, dividing the market and adjust conditions, benefits or abstention in the dispute over the industrial assembly of Petrobras tenders," CADE's statement read as quoted by Infobae.

According to Reuters, US District Judge Jed Rakoff has recently denied the requests of the company "to dismiss parts of the investor case."

The judge ruled that the plaintiff and Britain's Universities Superannuation Scheme Ltd. and Union Asset Management Holding AG cannot sue for losses on the debt securities offered by Petrobras in March last year.

Rakoff, however, did not rule in favor of the energy company on other issues concerning it. The judge reportedly upheld the decision to extend the class period, or the span of time they need to seek redress in the courts, added Reuters.

The Associated Press said this scheme started in 1998, but only went full swing under the leadership of President Luiz Inacio Lula da Silva in 2003.

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