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IDB debars construction company for corruption and collusion after $460 million settlement

The Inter-American Development Bank (IDB) debarred a Brazilian construction company Friday for three years for collusive and corrupt practices related to projects in Brazil.

Construtora COESA S.A. (formerly known as Construtora OAS S.A.) and 26 of its subsidiaries are ineligible to participate in projects and operations financed by the IDB during the 36-month debarment.

According to the IDB, Construtora arranged the submission of a bid by another company to simulate competition for a contract. It also failed to “act upon the knowledge of corruption” underlying the award of the contract to Construtora and its joint venture partner.

In another project, Construtora paid bribes totaling around $1.7 million to public officials involved in the supervision and management of two contracts, the IDB said.

In 2019, Grupo OAS (which controlled Construtora OAS S.A. at the time) paid around $460 million to settle charges related to this and other matters with Brazilian authorities.

As part of the settlement, Construtora committed to report on its compliance program through an existing independent monitor and to continue its cooperation with IDB’s Office of Institutional Integrity (OII).

The debarment qualifies for cross-debarment by the World Bank, the Asian Development Bank, the European Bank for Reconstruction and Development, and the African Development Bank.

A list of all IDB debarred entities and individuals is here.

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