The former CEO of Brazilian petrochemical giant Braskem was sentenced to 20 months in prison for his role in a scheme to divert hundreds of millions of dollars in bribe payments from the company to government officials and political parties in Brazil.
Jose Carlos Grubisich pleaded guilty in April to one count apiece of violating the anti-bribery and books and records provisions of the Foreign Corrupt Practices Act (FCPA). His sentencing, announced Tuesday by the Department of Justice, comes in addition to an ordered forfeiture of $2.2 million and a $1 million fine.
Grubisich, a citizen of Brazil, had faced up to 10 years in prison.
Between approximately 2002 and 2014, Grubisich—who served as Braskem’s CEO from 2002-08 and in various capacities for its parent company, Odebrecht—conspired with others to divert approximately $250 million of Braskem’s funds into a secret slush fund “to pay bribes to government officials, political parties and others in Brazil to obtain and retain business,” according to court documents. Grubisich and his coconspirators generated this slush fund through fraudulent contracts and offshore shell companies secretly controlled by Braskem, the Justice Department said.
Grubisich admitted he agreed to pay bribes to Brazilian government officials to ensure Braskem’s retention of a contract for a significant petrochemical project from Brazil’s state-owned and state-controlled oil company Petrobras. He also admitted to falsifying Braskem’s books and records via payments to offshore shell companies recorded as legitimate services and to signing false Sarbanes-Oxley certifications submitted to the Securities and Exchange Commission.
In December 2016, Braskem and Odebrecht pleaded guilty and agreed to pay a combined total penalty of $3.5 billion relating to the corruption case.