Who controlled account that got $92M in bribes? Leak sheds new light on Odebrecht scandal
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Pandora Papers
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A bombshell leak of secret offshore documents, combined with a legal document produced by Portuguese prosecutors, may have helped solve an enduring mystery in the Odebrecht bribery scandal that roiled Latin America.
The documents reveal that prosecutors believe a Panamanian offshore company through which $92 million in alleged bribes were funneled was controlled by the wife of a top Venezuelan government official.
The massive leak exposed the offshore dealings of hundreds of politicians and world leaders. Documents show that bribes allegedly paid by the giant construction company Odebrecht to former Venezuelan Transportation and Public Works Minister Haiman El Troudi for contracts to build a new metro line in Caracas moved through Portugal’s Espírito Santo Group, the holding company of Portugal’s now-defunct Banco Espírito Santo.
The millions paid in under-the-table Odebrecht “commissions,” the subject of a joint investigation by reporters in 2019, were placed under the control of the Panamanian offshore company Cresswell Overseas. Its secret beneficiary, prosecutors believe, was El Troudi’s wife, Maria Eugenia Baptista Zacarias, a new investigation conducted jointly by Expresso de Portugal, Armando.info and the Miami Herald shows.
The joint journalistic investigation grew out of documents found in the Pandora Papers, and led to further reporting that zeroed on a Portuguese document that names Baptista Zacarias.
Neither El Troudi nor his wife have been charged with a crime. Investigations into bribery involving Odebrecht and high-ranking officials in Venezuela are still ongoing in the United States and abroad.
The Pandora Papers involve 11.9 million confidential files in the possession of the International Consortium of Investigative Journalists (ICIJ), which put together a team of more than 600 journalists across the globe to dig through them.
The bribes linking Odebrecht to El Troudi had already been revealed by an earlier collaborative investigation, but the extent of the disgraced Espírito Santo’s involvement in the money-moving scheme was not yet known. There were also doubts about the extent to which the former minister in the regime of strongman Nicolás Maduro was the true beneficiary of Cresswell.
The Pandora Papers documents and related investigation suggest there was little honor among thieves, with owners of a troubled Portuguese bank trying to use ill-gotten gains from Venezuelans to fend off what was an eventual collapse.
According to Pandora Papers documents, Cresswell Overseas was managed by Paulo Murta, a Portuguese national who was at the center of a scandal involving the Portuguese bank and who was eventually extradited this past July to the United States.
Murta faces charges in Houston for his alleged involvement in an operation that handled more than $1 billion thought to have been stolen from Petróleos de Venezuela (PDVSA), the Venezuelan national oil and natural gas conglomerate. His presence in the Pandora Papers is the connective tissue that ties El Troudi and his wife to Cresswell.
Details about Murta are in the leaked files from the politically connected Panamanian firm Aleman, Cordero, Galindo & Lee, or ALCOGAL. It is one of the 14 offshore service providers whose leaked documents collectively make up the Pandora Papers.
Cresswell Overseas was opened through ALCOGAL and documents show that between 2012 and 2014 Murta opened and managed accounts on behalf of Cresswell at Espírito Santo Bankers Dubai (ESBD) and the parent bank’s branch in Madeira, a Portuguese archipelago off the northwest coast of Africa.
Some of the Cresswell funds were transferred in July 2014, according to documents, into an account opened at Meinl Bank in Antigua, an island in the Caribbean, just weeks before the nearly 150-year-old Espirito Santo collapsed and its president, Ricardo Salgado, lost control of the lender.
In all, $92.1 million was routed into the Cresswell bank accounts by Odebrecht between September 2012 and December 2014, a time when the Brazilian construction company secured its position in four major subway projects in Venezuela. The transfer first surfaced in a massive leak of internal records from Odebrecht’s so-called Bribery Division, which ran a parallel set of accounting books called Drousys.
El Troudi was the man in charge of these subway projects, valued in the hundreds of millions of dollars. More than $40 million later ended up in Swiss bank accounts linked to the former minister, according to a 2017 letter sent by Swiss prosecutors to their Venezuelan counterparts, initially reported by Armando.info.
In November 2013, months after her husband became minister, Baptista Zacarias opened a small company in Portugal with no employees and used it six days later for the 1.5 million euro (about $1.73 million today) purchase of a luxury apartment in Lisbon’s upscale Chiado neighborhood.
Prosecutors in Portugal examined Cresswell Overseas while conducting their main criminal investigation of Espírito Santo, which concluded in July 2020. Bank President Salgado and 24 other defendants were charged with “active corruption,” swindling, market manipulation, forgery, money laundering and criminal association. They were convicted and just this month handed large fines.
Their mismanagement led the bank to accumulate losses of 11.8 billion euros (about $13.6 billion today), triggering the Portuguese bank intervention.
But key parts of the story were left out of the Portuguese indictment, including the operations involving Cresswell.
Miami Herald partners in the joint investigation obtained a letter dated Jan. 8, 2020, sent by one of the prosecutors in the main Espírito Santo criminal case to a colleague who was working on a related investigation. In the letter, a prosecutor noted that Venezuelan Leopoldo José Briceño Punceles had appeared as the “formal holder” of Cresswell Overseas but “sufficient evidence has been gathered [to indicate] this entity actually belonged to Maria Eugenia [Baptista] Zacarias, wife of Haiman El Troudi.”
The prosecutor also said in the letter that Baptista Zacarias is a “Venezuelan citizen residing in Portugal” and that she was represented by a Venezuelan lawyer, Luís Henrique Delgado Contreras. The document also reported that both Baptista Zacarias and Delgado participated in “several meetings with elements of BES [Espírito Santo Bank].”
While she was on the radar of prosecutors, the underlying evidence was elusive. The Pandora Papers documents on Murta are what led reporters to the internal Portuguese prosecutorial documents suggesting El Troudi’s wife as the real beneficiary of Cresswell.
Reached by reporting partner Expresso, Ricardo Salgado and Paulo Murta did not comment. El Troudi and his wife also declined to comment when contacted by the online investigative outlet Armando.info.
The document also reveals how Cresswell Overseas invested between January 2013 and 2014 a total of $50 million in preferred shares of Espírito Santo Overseas Limited (ESIOL), a subsidiary whose line of business includes holding or owning securities of companies other than banks.
Although Odebrecht is not mentioned in the main Espírito Santo criminal case, a judicial source in Portugal, demanding anonymity to speak freely, told Expresso that the inquiry opened in 2018 by the Portuguese Public Prosecutor’s Office is related to bribes paid by that Brazilian construction company.
Registered in the Cayman Islands, ESIOL was a company whose sole assets were the loans it provided to Espírito Santo International (ESI), the main holding company of Espírito Santo Group.
A report produced by the Portuguese Public Prosecutor’s Office in March 2019, to which Expresso had access, described how this $50 million investment was made by Cresswell indirectly through another offshore company, Eurasian Investimentos Limitada.
Incorporated in January 2013 in the former Portuguese colony of Macau, now a part of China, Eurasian had a Bank of China account and listed Murta and Michel Ostertag, a Swiss national who was also implicated in the bank scandal.
Documents obtained by the reporters show that when questioned by Swiss prosecutors in Bern in July 2018, Ostertag said Baptista Zacarias was behind the $50 million investment in ESIOL and that the client’s dossier was managed by Paulo Murta, but that he had seen Baptista Zacarias’ identity documents.
When asked about the extent to which he knew the work that Paulo Murta did related to Venezuela, Ostertag said he remembered two Venezuelan clients: one was former deputy Minister of Energy Nervis Villalobos and the other was Baptista Zacarias.
Ostertag provided the comments in a deposition taken by Swiss authorities on behalf of Portuguese prosecutors.
The money invested by Minister El Troudi’s wife in preferred shares in ESIOL was fully injected into ESI, holding company for the bank, which was in a desperate situation by the end of 2013 after the Bank of Portugal (the country’s central bank) discovered the group’s holding company had hidden debts of 1.3 billion euros (about $1.5 billion today).
Luís Delgado Contreras, the Venezuelan identified by the Prosecutor’s Office in Portugal as Baptista Zacarias’ lawyer, was previously mentioned by three whistle-blowers in Brazil’s Operation Car Wash scandal, the origins of Odebrecht’s problems that ended up with a giant settlement in 2016 with U.S. and Swiss authorities
Contreras served as an intermediary who negotiated the approval of lucrative public works contracts for Odebrecht on the Caracas and Los Teques metro projects, the Miami Herald previously reported in a joint investigation with Armando.info and Brazilian news site Poder 360.
That report showed Delgado Contreras went by the code name “Camelo” in Odebrecht’s parallel accounting system, created to keep track of bribes. He was described to Brazilian prosecutors by two top Odebrecht Venezuela executives — Alessandro Dias Gomes and Euzenando Azevedo — as being very close to Minister El Troudi.
“Camelo” charged 2% of the value of the public works project, with total commissions exceeding $100 million, Dias Gomes told prosecutors, and those payments were made through Cresswell Overseas.
Odebrecht, meanwhile, has changed its name to Novonor, but some of its former employees and the people allegedly bribed still face investigations across the Americas.
Kevin G. Hall contributed. Hall began the Pandora Papers project as an investigative reporter for the Miami Herald and continued the work as North America editor for the Organized Crime and Corruption Reporting Project.
The Pandora Papers is a global collaboration between the Miami Herald and the nonprofit International Consortium of Investigative Journalists. If you like journalism like this, please make a donation to ICIJ to support it.
This story was originally published October 11, 2021 at 9:29 AM.
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