• Costa Rica Real Estate Auction
  • Costa Rica Real Estate

Brazil billionaire Andre Esteves arrested in Petrobras probe

November 25, 2015

SÃO PAULO, Brazil – Andre Esteves, the Brazilian billionaire who transformed BTG Pactual into the largest independent investment bank in Latin America, was arrested in the corruption probe that has shaken the country’s political and economic leadership.

The Supreme Court authorized the warrant to detain the financier on suspicion he and the leader of the government coalition in the Senate, Delcídio Amaral, allegedly tried to suppress testimony in the sweeping investigation into a pay-to-play scheme between the state-run oil giant, Petroleo Brasileiro SA, and the nation’s biggest builders, according to a press official for the court. Amaral was also arrested, making him the highest-ranking politician so far to be ensnared in the scandal.

The arrests usher in a new phase of a massive graft scandal that has crippled Brazil’s economy and left President Dilma Rousseff fighting for her political survival. The nation’s currency and stocks, which had stabilized in recent weeks after being in a freefall for much of the year, posted the worst drop among major markets Wednesday amid concern the scandal will prolong political gridlock and the longest recession since the Great Depression.

“The arrest of Mr. Esteves, the most high-profile figure in Brazilian finance, takes the Petrobras probe to a whole new level and shows the depth and breadth of a scandal that’s engulfing Brazil’s political and corporate establishment,” said Nicholas Spiro, managing director at Spiro Sovereign Strategy, in London. “The scandal is becoming more debilitating by the day and is severely undermining the prospects for any kind of meaningful economic reform.”

Amaral allegedly tried to convince former Petrobras director Nestor Cerveró, who was arrested in January, to not mention him or Esteves in testimonies to federal prosecutors, according to the Supreme Court press official, who cited the accusations read aloud Wednesday by Judge Teori Zavascki. The proposed agreement called for Cerveró to receive 50,000 reais ($13,000) every month, with BTG as the intermediary for payment, the official said.

“We’re surprised with the arrest, it must be a big mistake,” said Eduardo Marzagão, a spokesman for Amaral. “Certainly this will be showed to have been a great error.”

BTG Pactual said in an emailed statement that it is cooperating with the investigation and is willing to explain whatever is necessary to authorities, without providing further details. The bank’s stock plunged as much as 22 percent in São Paulo trading, its biggest drop ever.

More than 100 people have already been arrested, including former top executives at Petrobras and Brazil’s biggest construction conglomerate. The sweeping investigation into Petrobras — dubbed “Carwash” by prosecutors after a gas station used to launder money — has helped make Brazil’s real the world’s worst-performing major currency this year. Brazil’s economy is forecast to shrink more than 3 percent this year, according to a central bank survey of economists.

Esteves has been involved in various deals with Petrobras over the years, most notably Sete Brasil. BTG teamed up with Petrobras and other partners in 2010 to create the rig-supplier whose former operating chief admitted in plea bargains to crimes of corruption.

With assistance from Julia Leite, Paula Sambo, Elisa Martinuzzi and Carla Simoes.

© 2015, Bloomberg News

You may be interested

Volaris freezes growth in Costa Rica, citing high operating costs
Business
9 views
Business
9 views

Volaris freezes growth in Costa Rica, citing high operating costs

Alejandro Zúñiga - November 20, 2019

Enrique Javier Beltranena Mejicano, the CEO of Volaris, says the low-cost airline plans to "freeze growth in Costa Rica" in…

Spanish airline Evelop will offer flights to Costa Rica in 2020
Costa Rica
25 views
Costa Rica
25 views

Spanish airline Evelop will offer flights to Costa Rica in 2020

Alejandro Zúñiga - November 20, 2019

Spanish charter airline Evelop will offer flights between Madrid and Costa Rica starting in June 2020, the Costa Rican Tourism…

Costa Rica to face Mexico, U.S. to meet Honduras in Nations League semifinals
La Sele
19 views
La Sele
19 views

Costa Rica to face Mexico, U.S. to meet Honduras in Nations League semifinals

AFP and The Tico Times - November 20, 2019

Mexico sealed a perfect participation in the CONCACAF Nations League on Tuesday with a 2-1 victory against Bermuda, while the…

Do NOT follow this link or you will be banned from the site!