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Alstom’s “Black Box” and The Fictional Offshores

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The Estado de S. Paulo has stopped surfing the Net and rewriting press releases long enough to hunt down a genuinely new angle on the story of Metrogate — formation of cartels in the construction and extension of the S. Paulo subway and commuter rail system.

Documents from the Swiss investigation that led to the indictments of August 2012 — the case gathered dust for a year after the Swiss delivered their verdict — bring new dramatis personae into play

Source:  NE10 | OESP

Alstom set aside more than  US$ 20 million for bribing Brazilian officials, and part of these funds wound up in the coffers of political parties. This claim is part of the investigation realized by Swiss authorities and obtained exclusively by the Estado.

A group of ten, among them former state secretaries  Jorge Fagali Neto and Andrea Matarazzo, were indicted by Brazilian federal police in a case of an alleged corruption scheme involving Alstom, discovered by the Swiss.

The investigation shows internal communications from Alstom revealing the scheme to win public contracts in Brazil during the 1990s. In this scheme, Alstom proposes to pay bribes to finance political parties.  The court in Berne found that there existed “clear evidence of bribery” and even an “official  spreadsheet” detailing bribes paid in Brazil. The money was directed to various energy projects, including Furnas, Eletropaulo, Usina de Itá and other projects.

One of the central witnesses in the case is Michel Cabane, who was involved in the scheme and who affirms that “Alstom and Cegelec (an Alstom subsídiary) were working together to organize a system of payments to Brazilian decision-makers.” There was even a list of Brazilians employed by the company.

The Swiss court obtained from Alstom a copy of an internal communication, dated October 21,1997. In it, the director of Cegelec at the time, Andre Botto wrote that the money was to be used for bribery. … “This is a scheme ‘negociated’ by the former state secretary. It — the finances of the party — covers the state accounting tribunal (TCE) and the Secretary of Energy. The goal was to commit what the Swiss ironically call “the perfect crime.” Part of the money went to politicians, another part to the TCE and another to the Secretary of Energy, which would oversee  the bidding process.

Politicians – The Swiss authorities do not cite any particular party by name, but insist that political participation was a constant element. At that time, São Paulo was governed by PSDB. The initias RM probably stand for Robson Marinho, a member of TCE who, after organizing the Mário Covas campaign in 1994, was city chief of  staff, 1995 to 1997. The Swiss revealed every single transfer from Marinho’s accounts into the Safdie Bank in Geneva. The money arrived through an Uruguayan intermediary, a MCA.

Also cited is Romeu Pinto Junior, accused of having organized the payment of bribes through MCA. The investigation shows that on average, 7,5% of the contract value went to bribe-takers.  “According to these declarations,  7.5% and 1.13% of the contracts went to, MCA, 3.1% to Taltos and 0.6% para a Andros; 1,5% went to Splendore.” These were all fictional corporations.

Another Brazilian company involved was Alcalasser, which is said to have laundered more than R$ 50 million. In a deposition to French authorities, the ex-financial director of Cegelec, Michel Mignot, confirmed that Alcalasser was created to process bribes. “Its purpose was the commissions,” he said. His superior, Yves Barbier de La Serre, former secretary-general of Cegelec, also confirms the existence of a “black box.”