Brazil meatpacker fined for bribes that fueled US Growth

RIO DE JANEIRO — The owner of the world’s largest meatpacker pleaded guilty in U.S. national court on Wednesday to pay almost $180 million in bribes to lead Brazilian officials in exchange for state-backed funding used to go on a buying spree at the U.S.

Included in this settlement arrangement with the U.S. Department of Justice, it has to pay fines of $256 million — half of that is disregarded from hefty penalties it’s already agreed to cover the Brazilian government to the previously disclosed bribe obligations.

In a related agreement, JBS stated it would cover the U.S. Securities and Exchange Commission $26.8 million to accounting irregularities in its U.S. subsidiary Pilgrim’s Pride.

J&F’s legal counsel, Lucio Martins Batista, advised the courtroom that his family’s firm gave money and gifts, such as a $1.5 million New York apartment bought using a shell company, to five Brazilian officials between 2005 and 2017 to fasten J&F funding from insolvent banks.

A few of the proceeds from the financing deals were utilized to finance JBS’ growth in the U.S., in which in a couple of years beginning in 2007 it gained major rivals including Swift & Company and Pilgrim’s Pride.

At the moment, Brazil’s market was flourishing and the Batista household — that controls J&F — came to epitomize the picture of their swashbuckling”Brazillionaires” whose commodities-driven firms relied upon state funding to aggressively push beyond the nation’s boundaries.

“Today’s actions send a powerful message that we won’t relent in our efforts to conserve the law and hold everybody accountable to play the same, reasonable principles,” James Dawson, the FBI’s special agent in charge in Washington, said in a statement.

Nowadays, businesses dominated by J&F employ over 250,000 people in 190 countries, based on its site.

Bribe recipients incorporate an unnamed official called a high-ranking executive in-country development bank BNDES between 2004 and 2006 who went on to inhabit other senior executive branch places from the leftist governments of Luiz Inacio Lula da Silva and his left-wing successor, Dilma Rousseff, before 2015.

Those dates match with the career trajectory of Guido Mantega, who led BNDES from 2004 to 2006 and subsequently proceeded to function as Lula and Rousseff’s finance ministry. An attorney for Mantega didn’t immediately respond to a request for comment however, the former finance minister has denied any wrongdoing before.

The accusations in U.S. national court come because the Batista household is hoping to clean up its reputation for corruption in Brazil and about Latin America.

The punishment exceeded one levied against Brazilian building giant Odebrecht, which in 2016 also recurred into U.S. courts to repay its slew of bribery costs around the world.

JBS was a significant vendor of protein goods to Venezuela’s government, and also the U.S. has sanctioned as part of its attempt to drive President Nicolás Maduro out of electricity.

Separately, the JBS-controlled Pilgrim’s Pride, among the largest poultry producers in the U.S., said Wednesday it would pay $110.5 million to settle federal charges that it aided fixed costs for cows and subsequently passed on higher prices to customers.

“Pilgrim’s is dedicated to honest and fair competition by U.S. antitrust legislation,” said Fabio Sandri, Pilgrim’s CEO. “We’re encouraged that the current arrangement finishes the Antitrust Division’s research into Pilgrim’s, providing certainty concerning this issue to our staff members, providers, clients, and shareholders.