Monday, October 20, 2014

Brazil: President Rousseff Acknowledges Illegal Diversion of Assets at Petrobras

According to The Latin American Tribune, President Dilma Rousseff acknowledged Sunday (October 19) that she will take “all measures to return everything,” although she added that without a judicial ruling “nobody knows today what must be reimbursed.”

Her apparent motive for diverting assets from state-run Petrobras was to benefit political parties favorable to her government.

Her apparent acknowledgment of the diversion of assets from the state-owned energy company and publicly acknowledged that she would reimburse all the funds diverted.

COMMENT: It is a huge step for a sitting President to acknowledge the diversion of state-owned assets for political purposes.

Rousseff, who on October 26 will face off in a presidential runoff with opposition candidate Aecio Neves, said that she will take “all measures to return everything,” although she added that without a judicial ruling “nobody knows today what must be reimbursed.”

A corruption scandal at Petrobras has been marring the electoral campaign in Brasília for some time and  has been one of the most-discussed issues in the presidential campaign debates thus far.

According to the investigation into the matter, 3% of the budget for Petrobras contracts was diverted to finance the election campaigns of political parties allied with the government, including Rousseff’s Workers Party (PT).

The whistleblowers, who are telling the judiciary all they know about the illegal activities in exchange for reductions in their own sentences, include the former supply director of Petrobras, Paulo Roberto Costa, and businessman Alberto Youssef, the owner of an exchange house that allegedly handled the funds.

Despite the fact that the oppositon has been using the scandal to attack Rousseff, Costa recently said that late Sen. Sergio Guerra, who was the president of the Brazilian Social Democratic Party (PSDB) of Neves, who received “commissions” as part of the diversion of funds.

Guerra allegedly received money, according to Costa, in exchange for the opposition halting its efforts to create a parliamentary investigative commission to analyze the complaints against Petrobras.

On Friday (October 17), Petrobras announced that it had created internal commissions to verify whether or not deeds connected with the scandal were committed that harm the firm, saying that it, too, would seek to have any diverted funds reimbursed.

In the October 5 electoral first round, Rousseff garnered 41.5% of the votes to Neves’ 33.5%, but recent voter opinion surveys show the pair are technically neck and neck for the runoff.

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