October 14, 2021

Former petrochemical executive sentenced to 20 months’ imprisonment for FCPA violations

On October 12, 2021, the US District Court for the Eastern District of New York sentenced Jose Carlos Grubisich, the former chief executive officer of Brazilian petrochemical company Braskem SA, to 20 months in prison for his participation in a scheme to bribe Brazilian government officials.  As part of his sentence, Grubisich was also ordered to forfeit $2.2 million and pay a $1 million fine.

Grubisich previously pleaded guilty, on April 15, 2021, to conspiring to violate the anti-bribery and books and records provisions of the U.S. Foreign Corrupt Practices Act.  According to court filings, between 2002 and 2014, Grubisich—who was also a member of Braskem’s Board of Directors and served in various capacities for Odebrecht SA (a global construction conglomerate based in Brazil)—and others engaged in a scheme to generate funds through fraudulent contracts and shell companies secretly controlled by Braskem and various Odebrecht subsidiaries, and to then divert approximately $250 million of those funds into a secret slush fund, which they used to bribe government officials, political parties, and others in Brazil.  The court filings further allege that Grubisich falsely recorded payments to Braskem’s shell companies as legitimate services, that he agreed to use certain of these funds to bribe Brazilian officials to retain a lucrative petrochemical contract in Brazil, and that Grubisich signed Sarbanes-Oxley certifications falsely stating that Braskem’s annual reports accurately reflected its financial condition.  

In December 2016, Braskem entered into a global anti-corruption settlement with the US Department of Justice, the US Securities and Exchange Commission, Brazil’s Ministério Público Federal (MPF), and the Swiss Bundesanwaltschaft, in which it agreed to pay a combined global penalty of $957,625,737 and submit to an independent monitorship.  Braskem’s Brazilian monitorship ended in March 2020 and its DOJ and SEC monitorship ended in May 2020.   

DOJ Press Release | Criminal Minute Entry | Indictment