Petrobras will pay $ 853.2 million to settle corruption probes in the United States and Brazil

Petróleo Brasileiro SA, as the company is officially known, said Thursday it would pay $ 682.6 million to a Brazilian fund to promote transparency and corporate compliance and an additional $ 170.6 million distributed between the Department of US Justice and the Securities and Exchange Commission.

The corruption scandal over the state-controlled oil producer erupted in 2014, when Brazilian prosecutors announced their first investigation into a cartel of construction companies that had overcharged Petrobras and corrupted Brazilian politicians and leaders of Petrobras.

The investigation, known as Operation Car Wash, eventually threatened Petrobras and Brazil. It resulted in losses of several billion dollars for the company and slammed the course of its action, while sending in jail the former Brazilian President Luiz Inácio Lula da Silva and corporate executives. The scandal also continues to rage in the country's current election campaign.

For Petrobras, uncertainty about the legal repercussions fades considerably with the deal, although analysts warn that there are still pending lawsuits in Brazil and the Netherlands and an arbitration process in Argentina. In the meantime, the company's new management has restored Petrobras' profitability and is working to reduce its mountain of debt, helped by rising oil prices.

"It's a new story now. Petrobras is entering a new phase, "said Raphael Figueiredo, an analyst at Eleven Financial Research in São Paulo, adding that the deal" opens new opportunities ".

Petrobras' preferred shares rose 4.3% to 21.05 Rupees ($ 5.26) on Thursday afternoon. The share price fell to 4.41 reais in 2016, compared to about three times what it was just before the scandal broke out.

The Car Wash probe developed rapidly and attracted other giant Brazilian companies, including the construction company Odebrecht SA, which, according to Brazilian prosecutors, was the leader of the cartel of builders.

Odebrecht agreed in 2016 to pay $ 2.6 billion to solve the charges in the United States, Brazil and Switzerland, $ 93 million in the United States. The former managing director of the company, Marcelo Odebrecht, is still under house arrest for corruption in a prison cell.

In Thursday's agreement, US prosecutors considered that Petrobras was in part a victim of the conduct of its executives and executives, who were diverting funds from the oil company.

The Department of Justice agreed not to sue the company in exchange for a payment of $ 85.3 million, three years of compliance reports, and to admit that this scheme constituted a criminal violation of the laws requiring that public companies The company stated that it would continue to cooperate with ongoing investigations, including those involving individuals.

One of the laws, the Foreign Corrupt Practices Act, prohibits publicly traded US companies – including Petrobras – from bribing foreign officials and requires public companies to keep accurate financial records. .

Petrobras admitted that members of his board had sent millions of dollars in bribes to Brazilian politicians and political parties, prosecutors said. These payments included bribes ordered by a leader to stop a parliamentary inquiry into the company's contracts.

"Petrobras executives, including members of its board of directors and board of directors, have facilitated the payment of hundreds of millions of dollars in bribes to Brazilian politicians and political parties, regulators," said the head of the criminal division of the Department of Justice, Brian Benczkowski.

Petrobras reached a $ 930 million deal with the SEC, but the agency announced it would pay a $ 85 million fine, but a $ 85 million penalty.

The Petrobras settlement, with one fifth of the amount of the penalty going to the US, is the latest example of US prosecutors working with foreign counterparts to reach a simultaneous agreement with the multinational. It also follows recent Department of Justice policy statements that it would not be an "offender".

Businesses and their lawyers have welcomed this approach to settling criminal cases, claiming that it helps them solve cases that can last for years and cost hundreds of millions of dollars, even before they reach a regulation.

Write to Aruna Viswanatha at [email protected], Jeffrey T. Lewis at [email protected] and Samuel Rubenfeld at [email protected]