On September 27, 2018, Petróleo Brasileiro S.A. – Petrobras (“Petrobras”), a Brazilian state-owned energy company, entered into a non-prosecution agreement and agreed to pay $853 million to U.S. and Brazilian authorities to resolve an investigation into FCPA violations. As part of the agreement, Petrobras acknowledged that while its American Depository Shares traded on the New York Stock Exchange, members of the company’s Executive Board (its high-level managers) facilitated millions of dollars in improper payments to politicians and political parties in Brazil. Petrobras also admitted that it did not implement appropriate internal financial and accounting controls.
The $853 criminal penalty reflects a 25 percent discount off the low end of the applicable U.S. Sentencing Guidelines fine range, based on the company’s cooperation and remediation. Although the company did not voluntarily disclose the conduct, it did notify the government of its intent to fully cooperate when it learned of the allegations of misconduct. Petrobras’s cooperation included making regular factual presentations to DOJ, facilitating interviews of foreign employees, sharing information that would not otherwise have been available to DOJ, and implementing extensive remedial measures, including replacing its Board of Directors and Executive Board.