August 4, 2016 / 4:41 PM / 2 years ago

UPDATE 1-Braskem to start talks with US authorities over corruption accusations

(Recasts; Adds details of talks with U.S. authorities, CEO comments)

SAO PAULO, Aug 4 (Reuters) - Braskem SA, Latin America’s largest petrochemical company, said on Thursday it will start talks with U.S. authorities over accusations of corruption linked to a massive graft investigation in Brazil.

In its quarterly results statement, the company said talks with the U.S. Justice Department and the Securities and Exchange Commission (SEC) will clarify additional allegations of illegalities raised in the investigation of third parties.

Braskem’s two main stakeholders, state-run oil company Petroleo Brasileiro SA and Odebrecht, are engulfed in a giant bribery scheme that has led to the arrest of Odebrecht’s CEO and other top engineering executives.

Braskem has been the target of a shareholder lawsuit filed in mid-2015 in the United States over the alleged release of false statements to shareholders.

“At this moment the company has no way of measuring the impact that an eventual confirmation of those allegations could have,” Braskem Chief Executive Officer Fernando Musa told reporters in a briefing.

Musa said on Thursday he expects demand in Brazil this year to drop between 5.5 and 6 percent, less than its previous forecast for a fall of 7 percent.

The giant “Operation Carwash” investigation has unveiled a multi-billion dollar corruption scheme that involved executives of the country’s top construction companies and senior politicians. (Reporting by Priscila Jordao; Writing by Alonso Soto; Editing by Bernard Orr)

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