Vitol, rival oil traders in spotlight of Brazil bribery probe
SAO PAULO/LONDON: Brazil’s epic ‘ Car Wash’ corruption investigation has taken down presidents and elite businessmen, and led to the largest corporate leniency deal ever signed.
But graft allegations lodged by prosecutors last week against four of the world’s largest oil trading companies - Vitol SA, Trafigura, Glencore PLC and Mercuria Energy Group - have opened an explosive new phase in the longrunning probe.
Federal prosecutors allege the European multinationals and some smaller players collectively paid at least US$ 31 million in bribes over a six-year period to employees at Brazil’s state-led oil company Petrobras to sell them oil at sweetheart prices.
They said the firms’ top brass had “total and unequivocal” knowledge that they were fleecing Petrobras and that the illicit activity may still be ongoing.
More than 600 pages of legal documents reviewed by Reuters portray what prosecutors describe as a bustling criminal enterprise fueled by creativity, competition and greed.
Authorities say the trading companies often used freelance middlemen in an effort to cover their tracks, allowing these businessmen to negotiate deals and pay off Petrobras collaborators using bank accounts in several countries.
Emails obtained by investigators show intermediaries hustling to profit from their connections, authorities said.
Some shared spreadsheets divvying up to the last cent their cut of the spoils from deals they allegedly sealed with crooked Petrobras employees.
Prosecutors said the messages also show that rings of middlemen knew about one another and battled fiercely for the favour of the big oil-trading firms. Some discussed their attempts to woo top executives with promises of delivering more shady trades and fatter profits than rivals.
One intermediary griped that Vitol was “not at all sentimental” and would choose whomever could secure them the biggest returns.
“Now you are the flavour of the month, next month there is a new flavour,” the middleman lamented in the email.
Brazilian authorities last week searched the Rio de Janeiro-area offices of Vitol, Trafigura and Glencore as well as other entities they allege participated in the scheme. Police said they could not locate a physical office in Brazil for Mercuria. No charges have been filed.
Mercuria has denied wrongdoing. Mercuria, Vitol and Glencore said they would cooperate with the Brazilian investigation, while Trafigura said it was reviewing the allegations.
Trafigura, Mercuria and Vitol said they have zero- tolerance policies for bribery and corruption. Glencore said it takes ethics and compliance seriously.
Petrobras said it was cooperating with authorities and viewed itself as a victim of the alleged corruption.
Eight people have been arrested, including two employees of Petrobras whom the oil firm has since fired because of “strong evidence against them that they were involved in irregularities,” the company said in a written statement.
Interpol alerts have been issued for three other suspects who are outside Brazil, including a Petrobras trader based in Houston. None have been arrested.
The European firms - Vitol is based in London, the three others in Switzerland - are powerhouses in commodities trading.
They have investments in strategic energy and commodity infrastructure around the world, including in Brazil. Together they control about 10 percent of the world’s daily oil consumption and have revenues larger than Argentina’s gross domestic product. — Reuters