The (Big) State of Brazilian Journalism

Pitiful, how the Estado de S. Paulo metro daily has taken to the production of quasi-fake news of late, in the form of topical coverage of conference events produced by the newspaper itself for its various clients and then reported on as if objectively newsworthy. 

Car Wash Judge: Spy for the FBI?

Together with [Supreme Court Justice] Gilmar Mendes, Judge Moro symbolizes the biased and partisan justice system that plagues Brazil.

Paulo Nogueira of the Diário do Centro do Mundo on recent debate over Brazilian friends of Uncle Sam and his beloved GWOT.

Marilena Chauí was quite right to say some of what she said recently about Judge Moro.

Amigos S.A. | The New Sheriff in Western Zone Shantytown

Col. Alexandre Fontenelle Ribeiro de Oliveira, CEO of the death-dealing COE

In September, Rio de Janeiro’s Secretary of Public Security (SSP) released something of a bombshell for Brazil crime analysts: the city’s infamous militia groups have expanded dramatically over the past decade. —Insight Crime

Source:  EL PAÍS (Brazil edition).

An item for my clipping file on the death-dealing police. WordPress is misbehaving at the moment, however, which is very frustrating.

The story translated here dates back to mid-September, with a fresh round of warrants in early November.

Taiana Bares All | Brazil’s Operation Car Wash

Photo: Autumn Sonnichsen/ Divulgação Playboy

Wearing high heels and covered in dollar bills, the former lover of the currency trader [Youssef] appears on the cover of the January edition of Playboy posing in hotel rooms and private jets. She told the magazine that she was “the first person he messaged after he was arrested.”

As I have noted before, every knock down drag out political scandal has its muse or poster child — a figure, usually an attractive woman who, to coin a phrase, “lays bare the facts” or some such analogy as that.

• Petrobras | Whistleblower? Poster Child?

As Veja and Playboy are both Abril publications, it is not difficult to imagine how Taiana became the Goddess of Truth. Create a poster child with scandalous overtones  Divert attention from other significant  aspects of the case until you can measure the results and decide how — and against whom — to proceed.

Mountains of Money

This meme is a close cousin to the Mountain of Money concept in South American news media, itself a corollary to  the Perp Walk — a standard procedure for Brazilian police.

In Ecuador several years ago in an election won by the leftist Rafael Correa, the viciousness of the smear campaign by the local media was astonishing. Mobilized against Correa,  Ecuadoran TV and radio in general have to be seen to be believed , as is, or was, the case in Venezuela.

A case I remember well was an anti-Chavist talk show host who displayed a parking lot full of colorful HMMVVVs and identified them as constituting bribes to members of the government. A clever researcher was able to pin down the exact location of the photo — a HMMMVV dealership in Southern California. A sign was crudely Photoshopped in an attempt to identify the parking lot as government property in Venezuela. Grotesque.

Deep Float | Petrobras Underwater, Fire

A back of the napkin outline of the Pasadena scheme

Item.

•  Estado de S. Paulo | Fausto Macedo

There is curiosity today as to the identity of a “deep throat” witness in the Petrobras corruption megascandal.

One month after Operation Car Wash was carried out, in the middle of this year, a career public servant with 30 years of service approached federal agents in charge of the task force and denounced Petrobras for ignoring “signs of criminal behavior” and “intentional mismanagement” inside the state-run petroleum giant “in order to divert funds without awakening the suspicions of auditors and inspectors.”

Together with the acquisition of the Pasadena Refinery in the U.S. – the most emblematic of the charges involving the case — the witness named former Mines and Energy minister Edson Lobão as the “godfather” of one of the suspects and [alleged that] current Petrobras CEO Graça Foster was responsible for the nomination of two other senior executives in the foreign trade division, supposedly responsible for a sale of assets to Nigeria that had led to losses for the company.

Was it a note with awful grammar from some General Nigeriano Ubuntu offering you a handsome sum for laundering some huge amount of cash through your account?

This is the Nigerian Third World Corruption scam. Purge it from your e-mail client. A variant is the wealthy but oppressed damsel in distress, for those more responsive to an emotional stimulus, and might be called the Rwandan Woman in Fear for her Life gambit.

During a four-hour closed session held on April 28 in Rio de Janeiro, – the transcript was appended to the Car Wash case file on Tuesday — the «informant», whose name will not be released during continuing investigations, described six cases of alleged criminal misconduct, chief among them the acquisition of  Pasadena, initiated in 2005. The deal, valued at US$ 359 million at the outset, wound up cost US$ 1,2 bilhão, causing Petrobras to suffer a US$ 793 million, according to the federal accounting tribunal (TCU).

[ … translation to come …]

A Curious Case | The Jailhouse Militancy of Zé Dirceu

PSDB seeks support among the highly symbolic quilombo communities. Bad PR.

Zé Dirceu is a founding member of the Brazilian Workers Party and a former chief of staff to its iconic figure, former two-term president Luis Ignácio da Silva.

Zé Dirceu blogs.

Or more accurately, he blogs from behind bars after being found guilty by the Supreme Court of criminal conspiracy involving the skimming of cash from publicity budgets to feed election campaigns.

This may seem like a curious case, were it not for the ex-minister’s relentless argument that his conviction was a case of dois pesos e duas medidas — or, as you will sometimes find drunken (white) Brazilians saying, “For our friends, anything; for the rest, the Law.”

Dirceu, the ex-revolutionary, has a point. As the current president, Dilma, has insisted throughout the first two bloody TV debates, persons related to such scandals as (1) the buying of votes for the amendment that allowed presidential reelection in 1998 and the (2) laundering of money from state-sponsored sporting and cultural evidence for use as black market cash.

The two cases — I like to call them (drunk) the «Payolae of the PT and PSDB” — are for all intents and purposes identical, down to the same roster of shady characters that kept it in motion for over a decade, and yet nearly all cases involving the PSDB “get swept under  the rug.”

Lacking any way to defend or deny the serious charges against his political career as governor of Minas Gerais, against his party and the Cardoso government, the PSDB-DEM candidate for the presidency, Senator Aécio Neves, plays the role of victim and accuses his critics of lying and carrying on a dirty campaign.

Unaccustomed to never being questioned — quite to the contrary! — and having the media perpetually in his favor — during the «Gerais Minas payola» case he has mixed censorship with advertising budgets and accepted no critics or accusations.

That is, political use of an advertising budget intended to “inform” the population. The following is a matrix of spending on PSAs — public service announcements — by the Accounting Tribunal of MG, for example.

But to return to of our study of short-form Gutenberg dialectics, during  the first two debates, the opposition candidate would respond to a sharp question such as this like an aristocratic dueler — «Never mind that, I am a family man, an honest man, an honorable man.» The overuse of pathos arguments throughout took me back to my days in the classroom.

He wants to hide from voters the scandals of his government as well as his votes as a federal deputy.  This has been his intent in all the TV debates, including the one held by SBT yesterday.

The candidate spent the entire first round of the elections attacking the president and her government. Now that the tables are turned, he turns to the tactic of insulting his opponent with ferocity.

Feminists should look over the transcripts with special interest. There was a real Oedipal drama going on at certain points, as Dilma and Aecio form a sort of pair.

Aécio’s sister, a Globo-backed PR Amazon queen with a thick file of ball-busting incidents in questions of daily coverage, illustrates the extent to which the public’s business has become the family business. Aécio refused to comment on political appointments of relatives during his time as governor, except for the formulaic, “You lie, you stupid-pants on-fire liar, liar, liar, liar!”

A curious moment came when Dilma produced a document purporting to validate a claim about her opponent’s government of Minas and — reportedly — about 50,000 Internet users logged on at once, according to an official statement by the state Accounting Tribunal, which later explained that this had had the effect of a DoS on its servers. I took the snapshot above toward the end of the debate, I will have to look up the time stamp on the screenshot.

Zé:

Suffice it to observe the debate held by SBT-UOL-Rádio Jovem Pan yesterday. Or rather, that public policy proposals for the nation be the focus of the debate. This is exactly what the president did and is doing in the first and second rounds, failing to expose her proposals to public opinion.

Why did the PSDB candidate not explain the destination of public funds for his privately owned radio stations?

Aécio goes ballistic when asked — and Brazil is asking — about the budgeting of advertising and publicity on which the media of Minas has gorged itself during his eight years in office. Especially when this question relates to money earmarked for the upkeep of three radio stations and a newspaper his family owns in Minas. These budget allocations were made by the communications department of his state government, led by the candidate’s sister, Andrea Neves.

The PSDB candidate reiterated that Andrea — a potent player with a direct line to Globo —  worked as a “volunteer” in these episodes. Please!

The candidate grew even angrier when he was asked about the increase in levels of criminality every year during his two mandate (2003-2010), on the awful state of education in the state and on the siphoning off of R$ 7.6 billion from health care under his administration.

He has prepared a flipbook of talking points, such as  that education in his state is the best in the federal union and that its healthcare is the best in the Southwest region, as attested to by federal ministers of Education and Health. To this day no one has said they witnessed any ministers saying such things or from what source this information proceeds.

How much credibility does the  TCE-MG have?

Minutes after the revelation was aired, as in a magical illusion, the TSE-MG site went off the air.

When it came back online hours later, the reports on skimming  from health budget funds had disappeared. The TCE-MG has not even taken the trouble to explain what happened.

To be more honest, it eventually responded using the nastiest trick in the child’s first primer of crisis management: “Not our fault. Go ask the tech guys.”

How can an accounting tribunal publish and then “depublish” a report of this kind?

But that is what happened. The plug was simply pulled on the TCE-MG Web site. Who believes in the credibility of the rest of the work performed by a TCE capable of pulling such a stunt to protect a former governor? What value is there in trusting to the conclusions drawn about the accounts presented by this same governor?

What is more, Aécio boasts of having had all his accounts approved by the  TCE-MG, whose members he nominated and from whose site he is able to censor information relevant to irregularities in his administration …

Corruption in the PSDB: Everyone Is Out of Jail

During the latter Lula years, as the PT boasted at the the time, that PT legislators and executives had far fewer cases of malfeasance against them than the anti-situation mob at the time: the PSDB, the PFL-DEM and the perenially folkloric PMDB.

This was true — the study was carried out by Congresso em Foco — and remains true, but has not yet been emphasized by either candidate in this year’s contest, apparently in order to avoid politicizing ongoing investigations — like the politicization of the Auto da Fé of Zé Dirceu.

An important note: This is the first election held under the new elections law, so perhaps the Supreme Electoral Tribunal is worth following.

Alstom Case | Information “Round-Filed” For Years

Source: Jornal do Brasil

Federal lawmakers file suit against former attorney-general Rodrigo de Grandis. The parliamentarians demand an explanation for the postponement of a request for assistance from Swiss prosecutors.

The explanation given so far: The documents were filed in the wrong envelope and then lost and forgotten. I kid you not.

Workers Party legislators are due to file suit with the National Council of the Public Ministry (CNMP) this Friday against prosecutor Rodrigo De Grandis on the suspicion that he delayed acting on a request from Swiss authorities regarding the possible involvement of ranking Toucans — Social Democrats — in an international crime scheme. The collaborative effect was intended to examine the formation of a cartel involving Siemens and Alstom in contracts with the commuter railway, the Companhia Paulista de Trens Metropolitanos (CPTM).

The petition comes with the signature of the leader of the PT benches in the lower house, José Guimarães (CE), as well as deputies Ricardo Berzoini (SP) and Edson Santos (RJ). In the document, they ask for a true explanation of the violations of legal principles that a preliminary probe has already revealed. The document requests that if the charges are true, then de Grandis should be held responsible for a crime of omission in the investigation of the the CPTM cartel.

The PT deputies want more information on the fact that de Grandis [literally] buried the case. Deputy Renato Simões (PT-SP) says de Grandis failed to live up to his duties as a prosecutor, disrupting an investigation and refusing to collaborate with the Swiss, an action that needs a better explanation.

This weekend, information published in the press indicates that Rodrigo de Grandis [“round-filed”] the case starting in 2010 — and not just this case. He dragged his feet in eight more cases despite repeated requests for cooperation from the Swiss. The Swiss agency MOP discovered financial transactions by the consultantsArthur Teixeira, Sérgio Teixeira and José Amaro Pinto Ramos, all three suspected of brokering bribes, as well as the  ex-director of the CPTM, João Roberto Zaniboni, suspected of having gotten away with R$ 18.4 million from Alstom.

Folha de S. Paulo and its publisher Otavio Frias were uncharacteristically harsh in a case in which it, too, might be said to have swept a few facts under the rug:

A harsh editorial in the Frias family newspaper, calls the excuse that the file requesting the assistance of Swiss prosecutors looking into a case that involves bribery and the social democratic party.

“No investigation work has been done, then. And the reason given for this act of omission defies the credibility of even the most naive of us. They say they the request from the Swiss was misfiled. Or so says the prosecutor responsible for the case in Brazil, Rodrigo de Grandis,” the editorial says. “Let us not just leave it at that so that the Toucan train can roll on to its all too familiar destination: impunity.”

The Minister of Justice, Cardozo, says de Grandis failed to take action as ordered on several occasions.

Uma nota oficial do Ministério da Justiça, divulgada na noite de ontem, joga por terra a alegação do procurador Rodrigo de Grandis e do Ministério Público de que também teria havido falhas do governo federal na cooperação com autoridades suíças em relação ao caso Alstom, empresa que distribuiu propinas a personagens ligados ao PSDB para obter contratos milionários nos setores de transporte e energia em São Paulo. A equipe de José Eduardo Cardozo esclareceu ainda que o procurador Rodrigo de Grandis foi alertado em diversas oportunidades para tomar providências. Leia abaixo:

Brasília, 1º/11/2013 – Em relação à nota da Procuradoria-Geral da República, o Ministério da Justiça esclarece que não houve qualquer falha na tramitação dos pedidos de cooperação oriundos da Suíça referentes ao denominado Caso Alstom.

Os mencionados pedidos de cooperação foram encaminhados, desde março de 2010, à então Assessoria de Cooperação Internacional da Procuradoria Geral da República (atual Secretaria de Cooperação Internacional). Ressalta-se que este procedimento ocorre com todo e qualquer pedido recebido de países estrangeiros pelo Departamento de Recuperação de Ativos e Cooperação Jurídica (DRCI) e são direcionados à Procuradoria Geral da República para cumprimento.

Os únicos ofícios que foram encaminhados somente ao Procurador da República, Rodrigo de Grandis, foram seis reiterações dos pedidos iniciais, como forma de cobrar o andamento do pedido, procedimento adotado pelo Departamento.

Considerando este cenário, não procede a informação de que haveria tido falha no envio do pedido.

Jose Dirceu accused de Grandis of politicizing the case

News of an internal investigation of de Grandis is in th papers today: the Folha, the Estadão and Valor. “Rodrigo de Grandis did not comply with requests from Swiss authorities,” reads a subhed in the Folha. “Internal affairs wants to know why Rodrigo de Grandis did not comply with the request for assistance from the Swiss in the Alstom case, read a headline in the Estadão.

No episódio comprova-se mais uma vez a seletividade do Ministério Público nas investigações. E da cobertura da imprensa, que habitualmente dá pouquíssimo espaço ao caso – e nenhum, quando envolve o procurador De Grandis. Já a palavra dele próprio, entrevista, etc… – nada. Habitualmente exibido e falador quando é para atacar a honra alheia, ele agora se esconde da mídia.

Tampouco sua “distração” em relação ao pedido da Suíça, à investigação, motiva menções nos jornais a nomes de políticos e governadores tucanos em cujas administrações se formou o conluio em torno do cartel. Já quando os casos envolvem o PT o nome do partido e de seus integrantes vai para as manchetes, títulos, legendas, chamadas, textos – vai em tudo.

Will Siemens Energy Business Take The Perp Walk?

Source: Diário do Grande ABC | Agência Estado)

In the Siemens scandal — some call it the trensalão — the plot thickens slowly,tip by tip.

The letter that led to the investigation, in Brazil and Germany, into irregularities committed by Siemens in competitive bidding proceedings and the formation of a cartel in the subway and commuter rail system, cites other “illicit practices” not confined to the railway sector.

Irregularities were also pointed out in the energy and medical supply divisions of the German multinational.

Wild Danger and the Rio Rackets

A vintage roleta, used in the “animal game”

Source: Jornal O Globo.

Military police arrested in operation aimed at taking down a “nickel-hunter” gambling machine organization

RIO – A lieutenant-colonel of the Rio state military police (PM), along with other PMs, former PMs and prison guards are the targets of Operation Wild Danger, rolled out this Wednesday morning by GAECO — the  anti-organized crime division of the state judicial police — the state prosecutor and the military police.

As of 9:00 a.m. four PMs, four ex-PMs, two prison guards and six other subjects had been located. The 16 prisoners are accused of taking part in a security scheme for gambling racketeer Fernando Iggnácio. The investigation will execute 26 arrest warrants and 76 search warrants in an attempt to bring down a criminal conspiracy involved in the exploitation of “nickel-hunter” electronic slot machines.

See also

• Eleven police are dismissed for involved with jogo do bicho (black-market lottery racket )
• Convicted racketeers corrupted public agents and financed political campaigns.
• Court orders the arrest of racketeers convicted in Operation Hurricane

The operation involves the participation of some 400 men from the MP and the PM, with the support of some 100 vehicles and two helicopters.

Four cars from the PM’s Shock Battalion were parked in from front of Iggnácio’s building, on Mendes de Moraes Avenue, right across from São Conrado beach, in the Southern Zone of Rio. A helicopter overflew the scene. Using pliers, pick-axes and sledgehammers, five PMs entered the deluxe building.

Among those arrested was a trooper from BOPE, the special ops battalion, another from BMPVE, another from the 18th Battalion and another from the 39th Military Police Battalion. An unknown quantity of products used by the gang was apprehended. The arrests and the material seized are being taken to PM headquarters in downtown Rio.

The men are being charged with formation of an armed faction and passive and active corruption. The defendants according to  accusations, were active in Bangu, Realengo, Marechal Hermes and Campo Grande, as well as other neighborhoods in the Western Zone of Rio. The accusation is that the gang used the premises of a company called Ivegê, located in Bangu  and belonging Iggnácio, as its  HQ.

In an interview with Radio CBN, prosecutor Décio Alonso, who is leading the investigation, said that the PMs, ex-PMs prison guards are the armed wing of a criminal organization headed by Iggnácio.

The name is new to me. I try to keep up with back stories of this kind. 

They provided security services to the company and its owner, whom Décio describes as  “the capo of the bicho (animals)  game”.

Illiterate bettors are able to choose pictures of animals in order to register their bet. 

– -They are considered the armed element of this criminal association. They were assigned to sensitive locations, such as warehouses the fortress in Bangu and provided security to the scheme’s collections operation,” the prosecutor said.

According to Décio, in cases of unpaid debts — if the person did not pay the agreed-on price for use of the machines — the policemen would apply coercion. The debtors were tied up and delivered to one of the enforcers:

— The debt was then renegotiated. Promissory notes were issued.

According to the prosecutor, the gang has no ties to the drug traffice or to militias.

Yes, although the “nickel-hunter” machine does form part of the militia business plan in general. 

Décio also stressed that the PM was taken part in the investigation of its own people.

— The PMs  are cutting into their own flesh, he said.

Beltrame on Police Corruption

In an interview from February, state public safety secretary José Beltrame comments on state judicial police officers caught doing business with the bicho. 

RIO – A detective and seven inspectors of the state legislative police (PC) involved in the gambling rackets were fired today by state public safety secretary  José Mariano Beltrame, as Ancelmo Gois of Globo had predicted on Sundary.

Another two inspectors will lose their pensions. They were arrested in 2007, during the federal police Operation Hurricane. Police agent  José Januário de Freitas, detective Rogério Delgado Carneiro and inspectors Marcos Antonio dos Santos Bretas, Cláudio Augusto Reis de Almeida, Miguel Laino, Luiz Henrique Rosetti Loureiro, Armando Jorge Varella de Almeida, Juarez Giffoni Higino and Alexandre Candido Pereira de Almeida will be dismissed from their posts.

Inspectors Paulo Roberto de Carvalho Moreira da Silva and Maurício Alves de Araújo will lose their pension. 

 The operation against top leadership of the gambling rackets seized computers and documents from LIESA, the League of Independent Samba Schoosl 

Bicho banker met with police at his home

Convicted racketeers corrupted public agents and financed political campaigns. 

At the time, PF agents found packets of cash supposedly used by Aniz Abraaão David, aka o Anísio, patron of the Beija-Flor samba society; Aílton Guimarães Jorge, aka Capitão Guimarães, and Antônio Petrus Kalil, the Big Turk to bribe policemen. 

O Globo – A expulsão resulta de um inquérito administrativo? De quanto tempo?

Beltrame – O inquérito foi aberto em 2007, logo após a Operação Furacão, da Polícia Federal. É um procedimento administrativo que tem regras, prazos, recursos e ao fim é julgado pela Corregedoria Geral Unificada. Demora porque a lei é assim, dá amplo poderes de defesa aos acusados. Mas o importante é concluir os procedimentos com lisura para que não sejam questionados, para que o Estado não seja obrigado a readmiti-los

O senhor acredita que essas expulsões possam inibir o envolvimento de policiais com o bicho?

Beltrame – Acho que, como exemplo, ajuda a mostrar que não estamos parados, que os processos não ficam mais na gaveta, como era a prática das corregedorias. Ou seja, se for provado o envolvimento, o policial já sabe que perderá a carteira de trabalho.
Recentemente, a Polícia Civil apreendeu documentos na Liesa que indicariam o envolvimento de oficiais com a segurança da liga. Como o senhor avalia esse fato? Serão expulsos também?

Beltrame – Como disse anteriormente, se for provado o envolvimento, vai responder a processo e pode ser expulso. Esta é a regra do jogo. Aliás, sempre foi, a diferença agora é que os processos não ficam presos em burocracia. Desde que chegamos aqui em 2007, a ordem é tocar. Creio que, pelo número expressivo de policiais expulsos ao longo destes últimos seis anos, a mensagem está mais do que clara. Não vamos fazer concessões com qualquer tipo de corrupção ou desvio de conduta.

PL39/13 | A Chip Off the FCPA

No problem does more to alienate citizens from their political leaders and institutions,and to undermine political stability and economic development, than endemic corruption among the government, politica l party leaders, judges, and bureaucrats. — USAID Anti-Corruption Strategy

Source Valor Econômico | Portal ClippingMP.

Brazilian attorneys Leonardo Guimarães and Flávia Godinho compare recent anti-corruption legislation in Brazil with congeners in the U.S. and Britain.

Corruption indiscriminately affects citizens, public institutions and private organizations. Brazil as a whole is damaged when  corruption distorts the mechanism of the free markets — undermining fair competition, inspiring uncertainty among business owners, and driving away investors. For this reason,  combating corruption has been the subject of diverse international conventions, such as the Interamerican Anti-Corruption Convention organized by the OAS and signed in 1996; the OCDE Anti-Bribery Convention, from 1997; and the UN Anti-Corruption Convention, approved in 2005.

In response to the various international obligations it assumed, Brazil has passed laws designed to combat corruption, such as the Law of Administrative Impropriety and the “Clean Slate” Law.

Brazilian law still suffers from lacunae in its treatment of active corruption by a corporate entity, the only punishment for which is a restriction on the right to enter into contracts with the government.

Existing  mechanisms must be improved if the new law is not to be just another case of legislative inflation.

In the context of adapting our law according to international standards, we now have before us the PLA, the Anti-Corruption Bill (PL 39/13), which will regulate the civil and administrative responsibility of corporate entities for acts injurious to the public administration, both here and abroad. The law was approved in July 2007.

From the point of view of comparative jurisprudence,  PL 39/13 closely resembles the Foreign Corrupt Practices Act (FCPA), an innovative piece of legislation from the U.S.,in force since 1977, which prohibits the bribing of foreign public officials by U.S. corporations. It bears some  resemblance as well with the  Bribery Act, passed in 2011, a British anti-corruption law.

FCPA: Notable Cases

Although you read that the FCPA is too little used, there are at least two very interesting cases of its application: the Wal-Mart Mexico debacle and the record-setting settlement with SIemens.

An April 2012 article in The New York Times reported that a former executive of Walmart de Mexico alleged in September 2005 that Walmart de Mexico had paid bribes to officials throughout Mexico in order to obtain construction permits, that Walmart investigators found credible evidence that Mexican and American laws had been broken, and that Walmart executives in the United States “hushed up” the allegations. According to an article in Bloomberg, Wal-Mart’s “probe of possible bribery in Mexico may prompt executive departures and steep U.S. government fines if it reveals senior managers knew about the payments and didn’t take strong enough action, corporate governance experts said.”[6] Eduardo Bohorquez, the director of Transparencia Mexicana, a “watchdog” group in Mexico, urged the Mexican government to investigate the allegations.[7] Wal-Mart and the US Chamber of Commerce had participated in a campaign to amend FCPA; according to proponents, the changes would clarify the law, while according to opponents, the changes would weaken the law.

Siemens, in the Brazilian public eye at the moment, figures in this story, too.

In 2008, Siemens AG paid a $450 million fine for violating the FCPA. This is one of the largest penalties ever collected by the DOJ for an FCPA case

The lede:

In a December 15, 2008 press release, the U.S. Department of Justice (DOJ) revealed the details of a $450 million criminal fine payment made by Siemens AG, a German company, and three of its subsidiaries. The four pleaded guilty of violations related to the Foreign Corrupt Practices Act (FPCA). The three subsidiaries, Siemens S.A. – Argentina; Siemens Bangladesh Limited; and Siemens S.A. – Venezuela pleaded to one-count informations involving conspiracy to violate the anti-bribery and books and records provisions of the FCPA.

Taking One for the Team

Clarifying the line between “physical” and “legal” entities — my physical being and my purely notional translation business, say — is an important objective.

As in the examples just cited, the provisions of  PL 39/13 target the financier of the illegal act and not the receiver of the bribe. This is a completely novel approach with respect to the Brazilian legal system.

Within the spectrum of harmful acts that deserve to be repressed we find the defrauding of contract auctions and administrative contracts, as well as promising, offering or delivering, even if indirectly, an undue advantage to a public official or a third party related to that official.

In addition, it is forbidden to use an intermediary to hide or simulate the real interests or the identity of the beneficiaries of the act in question, or to hamper the work of agencies, institutions or public servants or intervene in their activity.

Administrative sanctions  — including the payment of a fine between 0.1% and 20% of gross income for the previous quarter — are applied independently of whether or not the guilt of a corporate entity is proven.

I read that paragraph carefully, and that is what it says. I suppose it means that if I cheat at poker in my official capacity as VP of Poker, my cheating reflects on my employer, since it was done in his name, even though without his knowledge.

There is a Brazilian legal concept called the domínio do fato that works in a similar manner. It came up frequently during the recent “payola” trial in the Supreme Court, where Zé Dirceu, for example, was not proven to have actively participated in the scheme but who was held responsible for reasons of domínio do fato.

Civil sanctions depend on proof of guilt or guilty intent, excepting the loss of assets and sums of money obtained by means of the infraction. It should be emphasized that the fate of the corporate entity does not let the physical person responsible off the hook — this person may be tried separately and/or simultaneously.

Also worth mentioning is the rule that provides benefits in the application of sentences for companies that adopt corruption prevention practices, such as “internal mechanisms and procedures to preserve integrity, audit carefully, and provide whistleblower incentives, as well as instilling effective ethical codes for the organization as a whole”.

This rule, one of the most beneficial provisions of the bill, stimulates the implementation or updating of “compliance” programs  — the Anglo-Saxon term means to act according to a rule. Compliance programs guarantee the adoption of conduct that conforms with the rules and polices, both internal and external, of the company, as well as fostering a transparent ethical atmosphere conductive to corporate best practices.

This is a major advance in our legislation, which will now take into account the procedures and internal policies of companies as a way of reducing punishments, as has become commonplace in countries like the U.S. and Great Britain.

Observe as well that where there is no regulatory framework to define the pillars of a compliance program, The American guide, A Resource Guide to the U.S. Foreign Corrupt Practices Act (PDF), can be useful. It identifies the “hallmarks” of what are considered to be essential factors in a successful compliance effort.

A integridade e os princípios éticos devem estar presentes em todas as ações realizadas pela empresa, incluindo seu relacionamento com o setor público. A possibilidade de uma mudança de cultura a respeito do relacionamento entre o poder público e o particular, com a incorporação de um compromisso das empresas contra a corrupção, é, certamente, uma boa inovação trazida pelo projeto.

Embora o projeto de lei, de forma geral, represente um avanço no combate à corrupção, principalmente no que se refere ao incentivo da criação de mecanismos internos de controle nas empresas, deve-se ter em mente as vulnerabilidades processuais e investigativas do nosso sistema, cujas leis anticorrupção anteriores não conduziram aos avanços esperados. A melhor resposta que se possa dar à corrupção, antes da criação de mais um aparato formal, é o aprimoramento e a efetivação dos mecanismos já existentes, para que as novas leis não se transformem em mera inflação legislativa, sem qualquer efetividade.