Brazil probes 13 banks over possible financial crimes for Schahin

Brazil's federal tax authority and prosecutors are investigating 13 foreign and local banks over potential financial crimes intermediating loans to engineering group, Schahin, say reports.  Schahin is currently being investigated for possible fraudulent operations that allegedly benefited the ruling Workers' Party through the oil firm, Petroleo Brasileiro SA. The probe is focused on whether the banks could be accused of money laundering for being originators, coordinators or managers of loans to the firm. The banks being probed include Itau Unibanco, Itau BBA, Banco Bradesco, Banco Santander, HSBC, Deutsche Bank and Votorantim. 

Brazilian prosecutors looking into possible foreign and local banks involvemrny in Petrobras corruption

12th Tuesday, January 2016 - 06:50 UTC Full article

Banks under investigation include Ita BBA - Itau investment-banking unit--,Banco Bradesco, Santander, HSBC Holdings Plc, Deutsche Bank and Banco Votorantim

The authorities are investigating whether the banks could be accused of money laundering for being originators, underwriters or managers of loans to Schahin.

Brazil's federal tax authority and prosecutors are investigating 13 foreign and local banks for possible financial crimes intermediating loans to Brazilian engineering conglomerate Grupo Schahin, newspaper O Estado de S Paulo says.

The banks under investigation include Ita BBA - the investment-banking unit of Itau Unibanco Holding SA, - Banco Bradesco SA, Banco Santander SA, HSBC Holdings Plc, Deutsche Bank AG, Banco Votorantim SA 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, underwriters or managers of loans to Schahin. Schahin is currently under investigation by Brazilian authorities for potential fraudulent operations that prosecutors allege benefited the ruling Workers' Party through state-run oil firm Petroleo Brasileiro SA.

In a statement, Ita BBA said it participated alongside the other banks in Grupo Schahin's debt restructuring process in 2009, which included a transaction backed by receivables from Petrobras. The operation was in full compliance with the law and market regulations, the statement said, adding that Ita BBA will collaborate with authorities.

Bradesco's press office said it could not comment on operations or positions of its clients because of bank secrecy rules. HSBC said it had not received any official information about being under investigation, adding that it always collaborates with authorities when requested.

Representatives at Brazil's federal prosecutors' office and other banks under investigation did not immediately respond to requests for comment. Other banks named in the Estado report are Banco Bonsucesso SA, Banco Fibra SA, Banco ABC Brasil SA, BicBanco SA, Banco Pine SA, Banco Tricury SA and Banco Rural SA.

Prosecutors say the engineering branch of the Grupo Schahin, Schahin Engenharia, was awarded a contract to operate a drill ship for Petrobras in exchange for the bank cancelling loan repayments for Jose Carlos Bumlai, a friend of former president Luiz Inacio Lula da Silva.

Bumlai was arrested on November 25 and charged with loan fraud on December 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.