Eletrobras' corruption probe zeroes in on Brazilian dams

miércoles 7 de octubre de 2015 11:10 GYT

By Caroline Stauffer

SAO PAULO Oct 7 (Reuters) - A commission hired by Brazil's state-run energy utility Eletrobras to probe possible violations of U.S. and Brazilian anti-corruption laws involving the company is studying three Amazonian dam projects and a nuclear power plant, two sources familiar with the investigation said.

They said the commission is investigating possible bribery in two $5 billion dam projects on the Madeira river, Santo Antonio and Jirau, as well as the massive Belo Monte dam and the Angra 3 nuclear power plant that prosecutors have already linked to a huge corruption scandal.

Both sources said the investigation is at an early stage but that the commission is looking at everything from how construction contracts on the projects were awarded to heavy cost overruns. Eletrobras owns Angra 3 through its Eletronuclear subsidiary and has a stake in the three dams under review.

One of the sources said the commission is sharing its information with the U.S. Department of Justice and the U.S. Securities and Exchange Commission.

Both the SEC and DOJ declined to comment when asked if they were investigating Eletrobras. Eletrobras said it would only comment on the commission's probe when it was concluded.

Brazilian federal prosecutors say construction firms involved in Brazil's largest-ever corruption scandal at state oil company Petrobras likely repeated a price fixing and political kickback scheme at Eletrobras, a smaller state-run firm that employs some of the same contractors as the oil giant.

Any discovery of corruption could force a balance sheet write-off and delay completion of the dams, preventing them from reaching their full capacities at a time Brazil's energy grid is recovering from drought.

Eletrobras, formally known as Centrais Eletricas Brasileiras SA, hired U.S.-based law firm Hogan Lovells in June to assess possible graft involving Eletrobras and private construction firms but did not say which projects were being checked.   Continuación...