BRAZIL-PETROBRAS/ROUSSEFF Petrobras scandal may change Brazil forever, Rousseff says

Record ID: 860845

  • Title: BRAZIL-PETROBRAS/ROUSSEFF Petrobras scandal may change Brazil forever, Rousseff says
  • Date: 17th November 2014
  • Summary: RIO DE JANEIRO, BRAZIL (FILE) (REUTERS) VARIOUS OF THE EXTERIOR OF THE PETROBRAS BUILDING RIO DE JANEIRO STATE, BRAZIL (FILE) (REUTERS) VARIOUS OF A PETROBRAS OFFSHORE DRILLING RIG
  • Embargoed: 2nd December 2014 12:00
  • Keywords:
  • Location: Brazil
  • City:
  • Country: Brazil
  • Topics: General
  • Reuters ID: LVA5EPZM5RQAMOOFE3ZRMGX97HB4
  • Aspect Ratio:
  • Story Text: A widening corruption scandal at state-run oil company Petroleo Brasileiro SA may change the country forever, Brazilian President Dilma Rousseff said on Sunday (November 16) in her first public remarks since a sweeping police operation last week.
    Police on Friday (November 14) arrested top executives of some of the country's largest construction and engineering firms as part of a probe into money-laundering and bribery allegations at Petrobras, as the oil company is commonly known.
    A former senior Petrobras executive responsible for some of the company's biggest contracts was also arrested.
    "You won't believe that we've had the first scandal in our history. This is the first scandal we've had in our history that's been investigated. There is a substantive difference there. And I think this, indeed, may change the country forever. How? In the sense that it will end impunity. This, to me, is the main characteristics of this investigation," Rousseff told reporters in Brisbane, Australia during a summit of the G20 Group of Nations.
    The scandal puts new pressure on the recently-re-elected Rousseff as weak growth and high inflation pose serious challenges to her effort to boost the economy.
    She may also have difficulty distancing herself from the problems at Petrobras.
    She was chairwoman of the board of directors, the company's highest official, from 2003 to 2010.
    On Monday (November 17) Petrobras vowed to fully investigate the scandal.
    The oil company delayed the release of its third-quarter earnings last week following accusations that the company systematically overpaid for assets and work by contractors.
    The excess funds were then funnelled to political parties including Rousseff's ruling Workers' Party, prosecutors said
    The company will reassess the value of some assets, based on whether bribes were part of the purchase price, and could take accounting losses accordingly, executives said.
    As a result, fully audited quarterly results might not be available until the end of January, they said.
    That raises the prospect of a long period of uncertainty for a company that was once the crown jewel of Brazil's economy, but has, in recent years, become a symbol of the country's fall from grace.
  • Copyright Holder: FILE REUTERS (CAN SELL)
  • Copyright Notice: (c) Copyright Thomson Reuters 2014. Open For Restrictions - http://about.reuters.com/fulllegal.asp
  • Usage Terms/Restrictions: None
Register