Brazil-based construction and engineering company Odebrecht has committed to make $50 million in total charitable contributions, starting in 2024, as part of a settlement reached with the Inter-American Development Bank (IDB) to resolve allegations of bribery.

According to the IDB, Odebrecht’s payments will go directly to NGOs and charities managing social projects “with the purpose of improving the quality of life of vulnerable communities in the IDB’s developing member countries.”

On Sept. 4, the Office of Institutional Integrity (OII)—an independent office of the IDB—announced the six-year debarment of CNO, an Odebrecht subsidiary, for engaging in prohibited practices in two IDB-financed projects. The debarment makes CNO ineligible to participate in IDB Group-financed projects.

The debarment follows an extensive investigation by the OII, which uncovered bribes paid in two IDB-financed projects: the Tocoma Hydroelectric Power Plant Program in Venezuela and the Highway Rehabilitation Program of São Paulo, Brazil. Under terms of the settlement, Odebrecht does not contest the evidence obtained by OII demonstrating that in both projects CNO committed corrupt practices when it made payments to public officials in order to facilitate either the award, contract execution payments, and/or contract amendments.

According to the OII, the illicit payments amounted to upward of 6 percent of each contract amount, including amendments. Specific to the Highway Rehabilitation Program, between 2006 and 2008, CNO paid government officials a total amount equivalent to approximately $380,000. In the case of the Tocoma Hydroelectric Power Plant Program, evidence obtained by OII indicates that between 2007 and 2015, illicit payments and transactions of up to $118 million were made utilizing a complex network of agents and offshore financial payment schemes.

The sanctions resulted in a negotiated resolution agreement between the IDB, the Inter-American Investment Corporation, and Odebrecht on behalf of its subsidiaries, CNO and Odebrecht Engenharia e Construção (OEC). The settlement also includes a conditional non-debarment applied to OEC for 10 years and CNO for four years directly following CNO’s six-year period of debarment.

“When conditionally non-debarred, a company remains eligible to participate in IDB Group-financed projects but only if it fully meets the conditions of the settlement,” the IDB said. “If any of the conditions are not met, the company will be debarred.”

In addition to the sanctions against CNO and OEC, 19 CNO subsidiaries will be subject to debarment, and a further 41 OEC subsidiaries will be subject to conditional non-debarment. CNO branches in Africa are excluded from the sanction. “Separately, the Odebrecht group commits to comply with certain conditions necessary to demonstrate its reforms,” the IDB said.

The settlement allows for a reduced debarment period due to Odebrecht’s continued cooperation, including internal investigations that are intended to uncover systemic integrity risks to IDB Group-financed activities. Under the terms of the settlement, Odebrecht commits to report on its compliance program through an independent monitor.

The debarment of CNO and listed subsidiaries qualifies for cross-debarment by other multilateral development banks under the Agreement for Mutual Enforcement of Debarment Decisions that was signed in April 2010.

In April 2017, a U.S. federal judge ordered Odebrecht to pay $2.6 billion in fines for violations of the U.S. Foreign Corrupt Practices Act, securing a plea deal reached the year prior with authorities in the United States, Brazil, and Switzerland. The judgment detailed the broad scope of the bribery scheme: “Executives and officers at the highest levels of Odebrecht were knowledgeable of and participated in the corrupt scheme,” court documents stated. Between 2011 and 2016, Odebrecht and its co-conspirators “paid approximately $788 million in bribes in association with more than 100 projects in twelve countries.” Those countries included Angola, Argentina, Brazil, Colombia, Dominican Republic, Ecuador, Guatemala, Mexico, Mozambique, Panama, Peru and Venezuela. According to court documents, Odebrecht, together with its co-conspirators, received approximately $3.3 billion in ill-gotten gains.