Brazilian Businessman Gets Stiff Sentence in Petrobras Scandal

March 12, 2016

Marcelo Odebrecht, the former chief executive of Brazil’s largest construction company, was convicted of corruption and money laundering on Tuesday. He was sentenced to more than 19 years in prison by the Brazilian judge who is leading the wide-ranging investigation into corruption at the state-owned oil company, Petrobras.

Testimony in the overall inquiry, which has shaken the country’s political and business elite, has shown that executives at Petrobras accepted large bribes from companies and channeled some of that money to political figures and the governing Workers Party.

The judge, Sergio Moro, in a 234-page decision, said Mr. Odebrecht had paid about $35 million in bribes to officials at Petrobras and had used overseas accounts to launder the money and make many of the illicit payments. “Corruption with the payment of bribes of over hundreds of millions of reals, which has the consequence of draining the public coffers, merits special condemnation,” Judge Moro wrote.

Mr. Odebrecht’s company, Odebrecht SA, was founded by his grandfather in 1944. It now operates in 27 countries, including Cuba, Venezuela, China and the United States, and employs more than 250,000 people. It won contracts to work on many of the stadiums built for the 2014 World Cup in Brazil and has worked on many construction projects for the Summer Olympics to be held here this August, including the athletes’ village and the Olympic Park.

The charges against Mr. Odebrecht related solely to the company’s contracts with Petrobras. Judge Moro said Mr. Odebrecht’s company had worked with other companies to systematically rig the bidding on Petrobras projects since 2006. Mr. Odebrecht had close ties with President Dilma Rousseff and her mentor and predecessor, former president Luiz Inácio Lula da Silva, who was questioned last week in connection with the Petrobras investigation.

Three other people, including other former Odebrecht executives, were sentenced on Tuesday. In all, 67 people have been convicted in the investigation, according to the federal prosecutor’s office in Curitiba. The investigation began two years ago, and there appears to be no end in sight.

The length of the sentence imposed on Mr. Odebrecht is highly unusual for a business leader, many analysts said.

“I can’t remember any other case in Brazil with as harsh a sentence against a business leader,” said Mauricio Santoro, a professor of political science at the State University of Rio de Janeiro. He said it would send a message to the business community about corruption and impunity.

Mr. Odebrecht’s sentence might influence the rest of the investigation, persuading other business executives who have been arrested to strike plea arrangements with prosecutors. “This will give a big incentive for other executives to cooperate with justice,” Professor Santoro said.

The newspaper O Globo reported on Tuesday, before the judge released the verdict in the case against Mr. Odebrecht, that the former head of a large construction company, Leo Pinheiro, and Mr. Odebrecht were interested in plea agreements.

Mr. Odebrecht’s lawyer, Nabor Bulhões, said the sentence was “unjust” and a result of “a grave judiciary error.” He contended that the evidence did not support Judge Moro’s ruling. Mr. Odebrecht is expected to appeal.