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Rolls Royce accused in Petrobras bribe case

Image courtesy of Rolls RoyceUK-based Rolls Royce has been accused of bribing an employee of Brazil’s state-controlled oil company to win a $100 million contract to provide gas turbines for oil platforms.

Former Petrobras employee Pedro Barusco reportedly told police Rolls Royce gave him at least $200,000 as a bribe. He’s cooperating with prosecutors after reaching a plea deal in November.

Barusco’s testimony was included in 600 pages of documents released by a federal court in Brazil this month.

Rolls Royce said it hasn’t been contacted by Brazilian authorities about the case. The company told the BBC Monday it doesn’t “tolerate improper business conduct of any sort.”

The UK Serious Fraud Office said in 2013 that it was “accelerating” a criminal investigation into allegations of bribery and corruption at Rolls Royce.

Rolls Royce said in late 2012 the SFO had asked it to investigate allegations of misconduct involving intermediaries in Indonesia and China.

Reports appeared in China two years ago that Rolls Royce bribed executives of Air China and China Eastern Airlines to win sales in 2005 and 2010. The head of the company’s aerospace division resigned in May 2013 after less than a year in the job.

In September last year, former Petrobras executive Paulo Roberto Costa admitted taking a $636,000 bribe in connection with the company’s 2006 purchase of a Texas refinery. Costa alleged that executives were skimming as much as three percent off the price of contracts and giving the money to political organizations.

Earlier this month, Petrobras CEO Maria das Graças Foster resigned, along with five other executives. The company has delayed releasing audited accounts while it deals with the impact of the corruption scandal.

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Richard L. Cassin is the publisher and editor of the FCPA Blog. He can be contacted here

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