July 31, 2015 / 11:42 PM / 4 years ago

Brazil says it has leniency deal with builder in corruption probes

BRASILIA (Reuters) - Brazil’s antitrust regulator CADE and federal prosecutors signed a leniency deal on Friday with engineering company Camargo Correa aimed at obtaining evidence of alleged price-fixing of contracts to build a nuclear power plant.

Camargo Correa was the first of Brazil’s construction firms to have its top executives convicted of corruption and money laundering in the massive kickback scandal involving over-priced contracts with state oil firm Petroleo Brasileiro SA.

The bribery investigation dubbed “Operation Car Wash” spread beyond Petrobras to the electricity sector on Tuesday with the arrest of top executives at Eletronuclear, the nuclear power unit of state-led utility Eletrobras, and builder Andrade Gutierrez, for alleged bribes paid on contracts to build the Angra 3 nuclear reactor.

The scandal has led to indictments and jailing of executives of Brazil’s biggest engineering firms and implicated dozens of politicians in President Dilma Rousseff’s governing coalition.

The federal prosecutors office for Parana state, where the corruption probe is being conducted, said the leniency deal will let Camargo Correa off the hook for fixing the prices of contracts with Petrobras in return for information on an alleged cartel set up to win the nuclear plant contract in 2013.

Company representatives could not be immediately reached.

Evidence of price-fixing in this contract was first revealed in February by Dalton dos Santos Avancini, chief executive officer of Camargo Correa Construções e Participações SA [PMORRC.UL], in plea bargain testimony in the Petrobras case, the prosecutors’ office said in a statement.

Avancini told prosecutors a cartel of engineering companies that paid an estimated $2 billion bribes to win Petrobras contracts used the same method to bid for the Angra 3 contract, now the target of a new probe called “Operation Radioactivity.”

Prosecutors said the alleged cartel was formed by engineering firms Andrade Gutierrez, Odebrecht, Queiroz Galvão, EBE, Techint, UTC Engenharia and Camargo Corrêa.

Earlier on Friday, two senior executives at Eletrobras told Reuters that they had requested leave as the corruption investigation sweeps Brazil’s largest electric utility. They said they had no involvement in the bribery scheme.

Reporting by Anthony Boadle; Editing by David Gregorio

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