Global Investigations Review - The law and practice of international investigations

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Monday, 23 March 2020

Brazil requests J&F settlement funds to help fight coronavirus

Brazil’s Federal Prosecution Service (MPF) asked the Supreme Court to allocate $1.46 billion in funds from a leniency agreement entered into with investment company J&F Investmentos to the federal government to help combat the coronavirus outbreak.

J&F agreed to pay $3.2 billion in June 2017 to resolve allegations of misconduct stemming from an investigation into pension funds known as Operation Greenfield.

Brazil’s Supreme Court reportedly accepted a request by Prosecutor General Augusto Aras on 19 March to divert part of state-controlled oil company Petrobras’ $682 million bribery settlement to help fight the outbreak. 

Former Rio Tinto manager reports company to regulators and SFO

Rio Tinto’s former head of strategic projects in Mongolia has reported the company to market regulators in the UK, the US, Australia and Mongolia over an alleged delay in disclosing problems with a copper mine in the Gobi Desert, according to the Financial Times.

Richard Bowley has also reportedly contacted the UK Serious Fraud Office with claims that the company knew that operations at its Oyu Tolgoi mine in Mongolia were running behind schedule long before they disclosed this to the market in July 2019. 

Rio Tinto reportedly said that an internal investigation into the matter conducted by Baker McKenzie had not supported Bowley’s allegations. 

Bowley is reportedly pursuing an unfair dismissal case against Rio Tinto at the UK’s Employment Tribunal.

Peru suspends Operation Car Wash investigations amid coronavirus pandemic

Peru’s Operation Car Wash task force has suspended its work following the government’s declaration of a state of emergency amid the spread of the coronavirus, according to reports.

The task force, which is investigating the extent of the Odebrecht bribery scandal in Peru, has suspended operations until at least 31 March.

The most advanced of its cases concerns Peru’s former president Ollanta Humala and his wife Nadine Heredia. Prosecutors are requesting 20 and 26 years in prison for them, respectively, based on allegations of money laundering. They deny wrongdoing.

Brazilian construction company Odebrecht admitted in 2016 to paying $800 million to officials in Peru in exchange for contracts as part of a $2.6 billion settlement with US, Swiss and Brazilian authorities.

MPs urge UK to mirror Magnitsky laws

Members of the UK’s Houses of Parliament have written a letter to Foreign Secretary Dominic Raab asking for the country to introduce a Magnitsky law akin to those in the US and Canada, according to The Telegraph.

The letter reportedly states that the UK’s proposed post-Brexit sanctions laws send “the wrong signal” to corrupt oligarchs and that failing to enact Magnitsky-style legislation will attract perpetrators of corruption and human rights abuses to the UK. 

The UK legal community has previously encouraged the government to introduce a Magnitsky law following its departure from the EU. The laws, named after Sergei Magnitsky, a lawyer who died in Russian custody in 2009, enable countries to target human rights abusers across the globe.

Deloitte South Africa agrees to return fees earned after “irregular procurement process”

Deloitte South Africa said on 20 March that it has agreed to return 150 million rand ($8.4 million) that it earned from two consulting agreements with South Africa’s state-owned electricity company Eskom.

According to the statement, released jointly with Eskom, Deloitte engaged in an “irregular procurement process”. The parties added that there was no evidence of corruption in the process.

South African investigative journalist organisation amaBhungane reported in January 2020 that Eskom awarded Deloitte two contracts even though the consultancy’s offer was significantly higher than those of other bidders.

Deloitte reportedly partnered with a company named Nkonki, which was run by an individual linked to the Gupta family, who have been accused of using their friendship with former South African president Jacob Zuma to win lucrative state contracts.

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