Odebrecht, the largest construction company in Brazil, and major petrochemical company Braskem have agreed to pay a combined penalty of at least $3.5 billion to settle allegations that they bribed government officials for business, U.S. authorities said Wednesday.
The companies admitted to paying hundreds of millions of dollars in bribes, money that law enforcement officials say was authorized at the highest corporate levels and was disguised through complex financial arrangements. Both companies pleaded guilty to bribery-related charges in federal court in New York.
The Justice Department called it the largest foreign bribery case under the Foreign Corrupt Practices Act. The 1977 law makes it illegal to bribe foreign government officials for business.
The companies have both agreed to co-operate with law enforcement, including in investigations into individual company officials.
In a statement Wednesday, William Burck, a lawyer for Odebrecht, said the company was "glad to be turning the page and focusing on its future." Earlier this month, the company apologized for its involvement in corruption scandals that led to the arrest of its former chairman and several of its executives. It acknowledged having made serious mistakes and promised not to rely on extortion or bribes to get contracts from public officials.
Odebrecht signed another agreement with Brazilian authorities to return almost $2 billion to public coffers.
The company is at the center of the mushrooming probe at state-run oil giant Petrobras, which has ensnared Brazilian politicians and business people across the board.
Dozens of Odebrecht executives signed plea bargains with prosecutors and as many as 200 politicians might be implicated in the corruption scandal.
On December 12 one of those plea bargain testimonies was obtained by The Associated Press and cites Brazilian President Michel Temer 44 times, with accusations of illegal campaign financing that put his embattled administration at an even bigger risk of ending within months.
The 82 pages of testimony by former Odebrecht director Claudio Melo Filho include allegations that Temer illegally financed his campaign in 2014. If the accusations are confirmed by Brazil's top electoral court next year, the president will be removed and Congress will pick a successor. In May, President Dilma Rousseff was impeached for breaking fiscal rules.