Corruption mars energy business in Barzil

AP/Fuel Fix:

The head of Brazil’s Petrobras vowed Monday to use a widening corruption scheme to improve governance at the state-run oil giant, in part through creation of a compliance department aimed at stamping out corruption.

In her first public remarks since the arrests of around two dozen people including a top company executive late last week, Maria das Gracas Foster told a conference call with investors, “We want to turn this difficult moment into something better.”

“Petrobras is a company that dreams to produce more and more oil and more and more transparency,” Foster said. “We are going through a very difficult moment in the company, but we are convinced that we will have better management after we structure and implement all of these management improvement processes.”

Authorities allege top company officials operated a kickback scheme on contracts involving several billion dollars, with the money eventually fed back to the governing Workers Party and other top parties for political campaigns. On Friday, police arrested Renato Duque, former director of services of Petrobras, for his alleged role in the scheme, along with the heads of several top construction firms.
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The story does not indicate whether the conduits for the corrupt political practices were also arrested or the politicians who received the money.   But it looks like it is a much deeper scandal than a few company executives.  It may explain why Brazil has become a laggard in recent years, although you can never discount the ill effects of the socialist government too.  Socialism is a corrupting influence that makes wealth transfers seem normal.