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Brazilian Chemical Maker Could Pay Billions Under Corruption Settlement

Petrochemical giant Braskem last week indicated that a deal to resolve corruption allegations with authorities in the U.S. and its native Brazil could be struck soon.

Mnet 124864 Braskem

Petrochemical giant Braskem last week indicated that a deal to resolve corruption allegations with authorities in the U.S. and its native Brazil could be struck soon.

Reports, meanwhile, suggested that Braskem and construction giant Odebrecht, which owns a stake in the company, could be on the hook for some $2.5 billion in penalties.

The allegations stem from Operation Carwash, a three-year probe that began due to improper payments to executives at state-owned Brazilian oil company Petrobras, which also owns a stake in Braskem.

Prosecutors alleged that Odebrecht and Braskem paid bribes to Petrobras officials in order to win contracts.

The reported settlement would be more than triple the previous record for multi-nation corruption settlement, according to Bloomberg, which previously noted that company executives signed plea agreements related to the investigation.

“Odebrecht recognizes it participated in inappropriate practices,” the company said following the initial Bloomberg report. “It was a grave mistake, a violation of our principles, an aggression to values of honesty and ethics. We won’t allow it to happen again.”

Reports also indicated that a joint leniency agreement signed by Odebrecht and Braskem would limit restrictions on their respective businesses.

Operation Carwash ultimately unveiled a massive bribery and kickback scheme that affected a wide swath of the nation's economy and politics.

More than 150 elected officials and business leaders — including Marcelo Odebrecht — were arrested in connection with the investigation.

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