Former Petrobras CEO Testifies Before Brazilian Congress

By Lise Alves, Senior Contributing Reporter

SÃO PAULO, BRAZIL – Brazil’s former Petrobras CEO, Maria das Graças Foster, told a Congressional committee on Thursday (March 26th) that she felt ashamed about the widespread corruption scandal that has engulfed one of the country’s largest companies, but reiterated that she knew nothing about the bribes-for-contracts scheme. During five hours Foster explained to congressmen that the Petrobras board of directors was not aware of the wrongdoings committed by some of its executives.

“I defend Petrobras’ control measures, but the corruption was discovered by the federal police,” she said during the congressional hearing, noting that she did not believe that the widespread corruption was institutionalized within the company, as some have claimed.

Showing strong emotion at times, Foster stated that she believes that the Lava Jato scandal (Operation Carwash) has brought benefits to the oil giant, forcing the company to adopt tighter control measures. She stated that a governance and compliance department has been created since the scandal broke, so that the company can review its operations.

Foster also answered questions about circumstances related to the purchase of the Pasadena (U.S.) Refinery, and the construction of the Abreu e Lima Refinery in Pernambuco.

In regards to the executives coming forward to admit wrongdoings, the former CEO, however, told congressmen that she found it hard to believe that middle-level managers, like Pedro Barusco, would have received kickbacks without any of his superiors being aware. Barusco agreed to tell all to federal prosecutors and return the millions he received in exchange for a lighter sentence.

Foster, along with five top board members, resigned in February, after the federal prosecutors revealed that Petrobras executives received at least R$2.1 billion (US$650 million) in kickbacks from companies interested in winning contract bids with the country’s oil giant.