Record Corruption Fine for Brazilian Meat Firm
01 Jun 2017 --- A record US$3.2 billion fine is to be paid by the Brazilian meat giant JBS over a series of corruption investigations. Private investment holding company for JBS and controlling shareholder of the world's largest meatpacker, J&F Investimentos, will pay the record fine as part of a leniency deal that has been struck.
The deal sets the payment over a 25 year period, starting at the end of this year.
It is believed to be the largest fine yet, beating the previous record fine of US$2.6 billion against the Brazilian building firm Odebrecht which was also involved in a corruption case centered around the country’s state oil company, Petrobras. Odebrecht admitted to paying bribes in 12 countries.
As part of the deal and plea bargain, it is understood owners Joesley and Wesley Batista, who have already resigned from their board positions at the company, gave a testimony. Reports say the two men admit they spent 600 million Brazilian real to bribe almost 1,900 politicians in recent years.
Operation Car Wash is Brazil’s biggest-ever corruption investigation which has been running for more than three years and involves an increasing amount of people.
It is believed to be the largest fine yet, beating the previous record fine of US$2.6 billion against the Brazilian building firm Odebrecht which was also involved in a corruption case centered around the country’s state oil company, Petrobras. Odebrecht admitted to paying bribes in 12 countries.
As part of the deal and plea bargain, it is understood owners Joesley and Wesley Batista, who have already resigned from their board positions at the company, gave a testimony. Reports say the two men admit they spent 600 million Brazilian real to bribe almost 1,900 politicians in recent years.
Operation Car Wash is Brazil’s biggest-ever corruption investigation which has been running for more than three years and involves an increasing amount of people.
The Supreme Court has also approved an investigation into the allegations against the Brazilian president Michel Temer who is allegedly embroiled in the case. This will likely deepen the country’s political crisis and there is mounting speculation calling for Temer to resign.
It is likely he will also be questioned as part of the investigation, however he denies any wrongdoing.
The amount of the fine corresponds with 5.6% of revenues earned by J & F companies last year, and will be adjusted on a yearly basis by Brazil’s IPCA inflation index which means it will likely increase.
JBS shares have gone down more than 28% recently during a turbulent trading period.
The scandal started in March when news first broke of the allegations surrounding Brazilian operators using rotten meat or violating regulation in processing.
Allegations also pertain to corruption within health departments where officials are accused of accepting bribes in return for falsified certificates and it’s the latest corruption scandal to rock the country.
It is likely he will also be questioned as part of the investigation, however he denies any wrongdoing.
The amount of the fine corresponds with 5.6% of revenues earned by J & F companies last year, and will be adjusted on a yearly basis by Brazil’s IPCA inflation index which means it will likely increase.
JBS shares have gone down more than 28% recently during a turbulent trading period.
The scandal started in March when news first broke of the allegations surrounding Brazilian operators using rotten meat or violating regulation in processing.
Allegations also pertain to corruption within health departments where officials are accused of accepting bribes in return for falsified certificates and it’s the latest corruption scandal to rock the country.
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