On March 11, 2021, Brazilian petrochemical company Braskem SA disclosed in a securities filing that it was investigating allegations of improper payments made by its indirect subsidiary Braskem Idesa in connection with “the Ethylene XXI project.” Braskem explained that these allegations were originally published by news outlets in Mexico and were also included in testimony provided to Mexico’s Office of the Attorney General by the former CEO of Pemex (a Mexican state-owned petroleum company). The investigation is ongoing, and Braskem stated that it was unable to estimate any timetable for its conclusion.
This recent investigation comes nearly a year after Braskem announced the successful conclusion of independent monitorships required under 2016 global anti-corruption settlements with the US Department of Justice, US Securities and Exchange Commission and Brazil’s Ministério Público Federal (MPF), based on allegations that between 2006 and 2014 Braskem had conspired with Odebrecht SA (a global construction conglomerate based in Brazil) as part of a massive bribery scheme involving millions of dollars paid to government officials in dozens of countries. Under these prior settlements, Braskem agreed to adopt enhanced compliance procedures, continue cooperating with law enforcement in connection with their respective investigations and prosecutions, retain independent compliance monitors for three years (a time period which was later extended), and pay a combined global penalty of $957,625,737.