October 10, 2018 / 7:28 PM / 2 months ago

Mexico plans to enforce Odebrecht fines via seizure: official

MEXICO CITY (Reuters) - Mexico plans to enforce fines it imposed on Odebrecht over corruption charges by confiscating some $30 million owed by state oil company Pemex to the Brazilian firm, according to a senior official at the public administration ministry.

Buildings under construction are pictured next to a banner of Odebrecht SA at the Rio 2016 Olympic Games athletes village in Rio de Janeiro, Brazil, November 23, 2015. REUTERS/Sergio Moraes

Christian Ramirez, coordinator-general of the public administration ministry (SFP), the government’s main anti-corruption auditor, told Reuters on Tuesday that he expected Mexico’s tax authority to seize the $30 million “in the coming months.”

Brazilian construction company Odebrecht [ODBES.UL] has spent the past four years at the center of one of the largest corruption scandals in Latin America, after admitting paying bribes for works contracts from Peru to Panama.

It has paid some $3.5 billion in settlements in the United States, Brazil and Switzerland in the wake of the scandal, which investigators began uncovering in 2014.

The company told U.S. and Brazilian prosecutors that it paid bribes amounting to $10 million in Mexico.

While Odebrecht has not faced criminal charges in Mexico, the SFP has said it found financial “irregularities” stemming from the bribery scandal and has handed down fines as a result.

In April, it imposed fines worth some $57 million in total on two Odebrecht subsidiaries. Since the end of 2017, it has punished several Odebrecht businesses in Mexico, barring them from signing contracts with public bodies for up to four years.

In a statement to Reuters on Wednesday, Odebrecht said the fines were improper and that it had pledged since last year to cooperate with government officials, without specifying the nature of that cooperation.

“Odebrecht is taking a series of legal steps by which it seeks to revoke the penalties improperly imposed, including the fine of some $57 million,” the statement said.

Ramirez said the $30 million figure was a preliminary finding by the agency of the minimum amount that Pemex [PEMX.UL] owed to Odebrecht, although it could owe more.

The SFP has not given details on the reasons for the fines, but officials who were not authorized to speak publicly about the case said they related to probes into suspected corruption between Odebrecht and Pemex.

In December, the SFP banned Odebrecht from bidding for federal public contracts for four years after finding that an affiliate had made an “incorrect charge” of $6.20 million in a contract with Pemex.

Ramirez on Tuesday said the Brazilian builder had “practically left” Mexico and that tax officials who recently visited an Odebrecht subsidiary only found “two computers and a desk.”

Reporting by Lizbeth Diaz and Diego Ore, Editing by Rosalba O'Brien

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