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Peru comptroller says Odebrecht irregularities cost country $283 million
January 11, 2017 / 9:46 PM / a year ago

Peru comptroller says Odebrecht irregularities cost country $283 million

LIMA (Reuters) - Irregularities detected in contracts awarded to Brazilian builder Odebrecht SA, a family-owned conglomerate at the center of a growing graft scandal in Latin American, have cost Peru at least $283 million, the comptroller said on Wednesday.

A sign of the Odebrecht Brazilian construction conglomerate is seen at their headquarters in Lima, Peru, January 5, 2017. REUTERS/Mariana Bazo

Authorities in Peru have been scrambling to gauge damages that Odebrecht may have wrought in the Andean country since the company acknowledged bribing unnamed officials there and in other countries in the region in a record $3.5 billion global plea deal signed in the United States.

Odebrecht won 23 public work contracts worth at least $16.94 billion in Peru between 1998 and 2015, including 16 that have been audited over the years, the comptroller’s office said.

Irregularities detected include unjustified cost overruns, improperly forgiven penalties for breaking contractual obligations and higher price tags for projects that competitors offered to do cheaper, Comptroller Edgar Alarcon told a news conference.

A project for building a highway across the Amazon that Odebrecht won in 2005 ended up costing nearly twice as much as initially proposed, the comptroller said in a report that described stretches of the highway as subpar.

Odebrecht did not immediately respond to requests for comment. The company’s local unit said last week that its top priority was to assist prosecutors and eventually pay Peru reparations.

The company agreed to pay Peru an initial $8.9 million in a gesture of goodwill last week as it promised to give prosecutors in the attorney general’s office details on kickback schemes.

The $29 million in bribes that Odebrecht has admitted to giving officials in Peru span three presidencies, threatening to expose high-level corruption in the governments of former presidents Ollanta Humala, Alan Garcia and Alejandro Toledo.

Current President Pedro Pablo Kuczynski served as finance minister and prime minister in Toledo’s government and will be one of eight former ministers asked to offer testimony in a parallel probe into Odebrecht in the justice ministry, prosecutors said this week.

Reporting By Mitra Taj; Editing by Meredith Mazzilli

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