October 26th, 2020

Brazil meatpacker fined for bribes that fueled US expansion


By David Biller And Joshua Goodman, The Associated Press on October 14, 2020.

RIO DE JANEIRO – The owner of the world’s largest meatpacker pleaded guilty in U.S. federal court on Wednesday to paying nearly $150 million in bribes to top Brazilian officials in exchange for state-backed financing used to go on a buying spree in the U.S.

Sao Paulo-based J&F Investimentos pleaded guilty in federal court in Brooklyn to one count of conspiring to violate the foreign corrupt practices act. As part of the settlement agreement with the U.S. Department of Justice, it must pay fines of $256 million – half of which will be discounted from hefty penalties it has already paid to Brazilian authorities for the previously disclosed bribe payments.

J&F’s legal counsel, Lucio Martins Batista, told the court that his family’s company gave cash and gifts, including a $1.5 million New York apartment, to five Brazilian officials between 2005 and 2017 to secure J&F financing from state-run banks.

Some of the proceeds from the financing deals were used to fund JBS’ expansion in the U.S., where in a span of a few years starting in 2007 it acquired major competitors including Swift & Company and Pilgrim’s Pride.

At the time, Brazil’s economy was booming and the Batista family — which controls J&F — came to epitomize the image of the swashbuckling “Brazillionaires” whose commodities-driven companies relied on state financing to aggressively push beyond the country’s borders.

Today, J&F employs more than 250,000 people in 190 countries, according to its website.

Bribe recipients include an unnamed official described as a high-ranking executive at state development bank BNDES between 2004 and 2006 who went on to occupy other senior executive branch positions in the leftist governments of Luiz Inacio Lula da Silva and his hand-picked successor, Dilma Rousseff, until 2015.

Those dates coincide with the career trajectory of Guido Mantega, who headed BNDES from 2004 to 2006 and then went on to serve as Lula and Rousseff’s finance minister. Mantega could not be immediately reached for comment but has denied any wrongdoing in the past.

The accusations in U.S. federal court come as the Batista family is trying to clean up its reputation for corruption in Brazil and around Latin America.

In 2017, J&F was levied a record fine of then $3.2 billion for its role in corruption scandals. The penalty exceeded one imposed against Brazilian construction giant Odebrecht, which in 2016 also recurred to U.S. courts to settle its own slew of bribery charges around the world.

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Joshua Goodman reported from Medellin, Colombia.

Follow Goodman on Twiter: @APJoshGoodman

Follow Biller on Twitter: @DLBiller

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