Brazil probes 13 banks for Schahin, Petrobras operations -report (updated)

Banco Bradesco

11/01/2016 18:51

(Adds HSBC, Deutsche Bank's comments) 
    BRASILIA, Jan 11 (Reuters) - Brazil's federal tax authority 
and prosecutors are investigating 13 foreign and local banks for 
possible financial crimes intermediating loans to Brazilian 
engineering group Schahin, newspaper O Estado de S. Paulo 
reported on Monday. 
    The banks under investigation include the investment banking 
unit of Itau Unibanco Holding SA  ITUB4.SA , Itau BBA, Banco 
Bradesco SA  BBDC4.SA , Banco Santander SA  SAN.MC , HSBC 
Holdings PLC  HSBA.L , Deutsche Bank AG  DBKGn.DE , Votorantim 
and other smaller Brazilian institutions, Estado reported, 
citing a tax office document. 
    The authorities are investigating whether the banks could be 
accused of money laundering for being originators, coordinators 
or managers of loans to Schahin. Schahin is currently under 
investigation by Brazilian authorities for potential fraudulent 
operations that allegedly benefited the ruling Workers' Party 
through state-run oil firm Petroleo Brasileiro SA.  urn:newsml:reuters.com:*:nL1N1431UI 
    Bradesco's press office said it could not comment on 
operations or positions of its clients because of bank secrecy 
rules. HSBC said it did not receive any official information 
about being under investigation. HSBC added that it always 
collaborates with authorities when requested. Deutsche Bank 
declined to comment. 
    Spokespeople at Brazil's federal prosecutors' office and 
other banks under investigation did not immediately respond to a 
request for comment. Other banks named in the Estado report are 
Banco Bonsucesso SA  BONSD.UL , Banco Fibra SA  BANFI.UL , Banco 
ABC Brasil SA  ABCB4.SA , Bic Banco  BICBA.UL , Banco Pine SA 
 PINE4.SA , Banco Tricury SA and Banco Rural SA. 
    The engineering branch of the Grupo Schahin, Schahin 
Engenharia, was awarded a contract to operate a drill ship for 
Petrobras  PETR4.SA  in exchange for the bank canceling loan 
repayments for Jose Carlos Bumlai, a friend of former president 
Luiz Inacio Lula da Silva. 
    Bumlai was arrested on Nov. 25 and charged with loan fraud 
on Dec. 14. 
    Dozens of executives from Brazil's top construction and 
engineering firms have been charged with bribery and money 
laundering, and about 50 politicians are being investigated for 
receiving kickbacks off Petrobras contracts. 
 
 (Reporting by Silvio Cascione; Editing by Daniel Flynn, Hugh 
Lawson and Bernard Orr) 
 ((silvio.cascione@thomsonreuters.com; +55 61 3426 7015; Reuters 
Messaging: silvio.cascione.thomsonreuters.com@reuters.net)) 
 
Keywords: BRAZIL CORRUPTION/BANKS