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Brazilian Engineering Executives Charged in Petrobras Scandal

  • Reuters

People walk in front of Brazilian oil company Petrobras's headquarters in Rio de Janeiro, Nov. 14, 2014.

People walk in front of Brazilian oil company Petrobras's headquarters in Rio de Janeiro, Nov. 14, 2014.

Brazilian prosecutors formally charged executives from six of the country's largest engineering firms with forming a cartel to funnel kickbacks from state-run oil firm Petrobras to the ruling political party and its allies on Thursday.

They were also indicted on charges of corruption, money laundering and organized crime in a landmark case that has shaken President Dilma Rousseff's government.

The companies with indicted executives are OAS, Camargo Correa, UTC Engenharia, Galvao Engenharia, Mendes Junior and Engevix.

The corruption scandal, in which billions of dollars were allegedly paid by the companies in bribes to win Petrobras contracts, threatens to paralyze infrastructure projects vital for reviving Brazil's stagnant economy.

The case is expected to implicate dozens of politicians and weaken Rousseff's already fragile governing coalition as she begins a second term on Jan. 1.

Prosecutors said they are seeking the return of about 1 billion reais from the companies involved in the bribery scheme.

“We are in a war against impunity and corruption,” prosecutor Deltan Dallagnol said at a news conference. “The victim of this scheme was Petrobras.”

35 people were indicted, of which 22 are linked to the engineering companies.

The executives, some of whom have been held for nearly a month at the federal prison in Curitiba where the scheme was discovered, could face sentences of more than 20 years in jail.

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