RIO DE JANEIRO (Reuters) - Brazilian prosecutors have formally charged General Electric Co’s chief executive for Latin America for alleged involvement in a healthcare cartel, officials said on Wednesday, though a judge ruled that he should be released from jail for now.
Daurio Speranzini Jr. was one of 24 people arrested a month ago as part of an investigation into fraud in medical equipment tenders overseen by health authorities in the state of Rio de Janeiro.
The crimes investigated occurred from 2004 to 2010 when Speranzini was head of Philips Medical Systems in Brazil, prosecutors said, and continued until 2015 while he had various positions in GE’s healthcare unit.
In previous documents, prosecutors argued that GE was part of a group of companies that funneled bribes through a politically connected local medical supply firm. The documents said Speranzini was fired from Philips after a whistleblower told Philips’ compliance office about the scheme.
Two months after being fired, he was hired by GE Healthcare, taking on a succession of jobs and eventually becoming GE’s Latin America head.
“The criminal scheme involved the participation of dozens of companies that, via a cartel, defrauded decades of tender processes,” prosecutors said in documents filed with the court on Wednesday.
Also on Wednesday, Speranzini was freed from jail after a Supreme Court minister opted to apply measures such as restricting his contact with others under investigation, instead of keeping him incarcerated.
Reuters was unable to locate a lawyer for Speranzini for comment.
In a statement, Philips said it was committed to following Brazilian rules and regulations, and that any investigation would be treated “very seriously.”
GE defended its business practices and said it was committed to cooperating with authorities. It added that Speranzini remained suspended during the investigation, and that the probe would not affect service to clients or relationships with partners.
Reporting by Pedro Fonseca; Writing by Gram Slattery; Editing by Richard Chang