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Petrobras starts probe of potential conflicts of interest in its personnel division

Petrobras, Brazil’s scandal-ravaged state oil company, has launched an internal probe of potentially improper and costly practices by its human resources division, according to Bloomberg citing Brazilian newspaper Valor Economico on Monday.

The firm is already under the microscope of federal investigations and court cases plus the glare of media publicity for being the hub of an extraordinary multibillion dollar web of graft in which contractor firms bribed Petrobras officials for inflated contracts. Politicians of the ruling Workers Party have also been implicated for taking kickbacks.

The cost of the graft is thought to exceed $2bn by Petrobras estimate alone.

The political ramifications have been widespread and have most recently seen former national president Luiz Inacio Lula da Silva (popularly known as Lula) charged with money laundering and misrepresentation. They could yet engulf current president Dilma Rousseff who was Petrobras’ chairwoman from 2003-2010.

Now Valor Economico says Petrobras’ director of governance, risk management and compliance Joao Elek is looking into whether or not the HR department gave special treatment to union members at top management levels and if that led to potential conflicts of interest in salary negotiations.

The HR department began being managed by union-linked executives around the time of Lula’s first term as president.

Some of the salary deals negotiated have the potential for hundreds of millions of dollars of liabilities, the report says.

Petrobras, a major offshore oil producer in Latin America, is already the world’s most indebted oil company, is reeling from the slump in the oil price and has been slashing costs and divesting assets.

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Donal Scully

With 28 years experience writing and editing for newspapers in the UK and Hong Kong, Donal is now based in California from where he covers the Americas for Splash as well as ensuring the site is loaded through the Western Hemisphere timezone.
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