Implode-o-Meter News - Petrobras Oil Scandal Leaves Brazilians Lamenting a Lost Dream

As one of the world's largest oil companies, Petrobras spends more than $20 billion a year expanding its capacity, building new plants and servicing facilities. That means huge sums of money are spent on a variety of work, much of it subcontracted to companies that have long fought one another for the business.
But about a decade ago, according to prosecutors, these companies stopped competing and started to collaborate. They formed a cartel and decided, in advance, which of them would win a particular deal. A charade competition was orchestrated, and the anointed winner could charge vastly more than it would in a free market.

The cartel called itself "the club," according to depositions and documents submitted to the court. It had 16 members by 2006, including blue-chip behemoths like Odebrecht and Camargo CorrÃªa.

From 1 to 5 percent of the value of a given contract was diverted to those on the receiving end of the scheme, a group that included 50 politicians from six parties, according to prosecutors.

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Petrobras Oil Scandal Leaves Brazilians Lamenting a Lost Dream