August 20, 2018 / 4:33 PM / a month ago

Mexican steelmaker paid millions to Odebrecht shell company - report

MEXICO CITY, Aug 20 (Reuters) - Altos Hornos de Mexico, one of Mexico’s largest steelmakers, paid $3.7 million to a shell company allegedly set up by Brazilian builder Odebrecht to pay bribes, investigative news site Quinto Elemento Lab reported on Monday.

AHMSA made three wire transfers to the account weeks after it announced a controversial 2014 sale of a fertilizer plant to Mexican state oil company Pemex, Quinto Elemento reported, citing documents from Brazil’s Supreme Court.

It is unclear what links may have existed among Odebrecht, AHMSA and Pemex. Mexican authorities have been probing business between the oil company and the Brazilian conglomerate, which in recent years has admitted to paying over $3 billion in bribes across Latin America, including $10 million in Mexico.

The account paid into by AHMSA, according to the documents cited by the report, was registered in Antigua by Odebrecht operatives in the name of Grangemouth Trading Company, which is registered in Scotland.

Grangemouth appears on a list of offshore firms set up by Olivio Rodrigues Junior, who worked for Odebrecht and who in testimony to prosecutors said he helped his employer pay bribes, Quinto Elemento reported.

AHMSA spokesman Francisco Orduna confirmed to Reuters that the payments were made, but said they were for Grangemouth to advise AHMSA on equipment, systems, logistics and suppliers for a steelworks expansion in Monclova, Mexico.

Odebrecht did not immediately respond to a request for comment.

Grangemouth, registered with Britain’s business registry in March 2013, in documents online says it sources heavy equipment and represents manufacturers and used equipment dealers. It lists as its general partner Stichting Tilbourg Crossing, a Netherlands-based entity that the documents say was also part of the Odebrecht bribes structure.

Reuters was unable to reach anyone representing Grangemouth or Stichting Tilbourg Crossing.

According to the report, the payments began shortly after AHMSA completed a $273 million sale of a fertilizer plant to Pemex, a transaction later criticized by Mexican auditors as expensive and poorly analyzed.

The report did not prove a direct link between the Grangemouth payments and the Pemex contract or show where the money AHMSA paid to Grangemouth went.

Pemex’s chief executive at the time, Emilio Lozoya, has been questioned by Mexican prosecutors about Odebrecht bribes. Last year, Quinto Elemento published videos of testimony by Odebrecht executives to Brazilian prosecutors in which they said they paid Lozoya millions of dollars in bribes in exchange for contracts.

Javier Coello Trejo, Lozoya’s attorney, told Reuters that his client did not receive bribes from Odebrecht or AHMSA and that none of his work at Pemex has been proven to have involved corruption.

AHMSA’s Grangemouth payments were made to an account with Meinl Bank Antigua, Quinto Elemento reported. The account is the same one Odebrecht executives in testimony said they used to pay Lozoya.

Once a close advisor of outgoing President Enrique Pena Nieto, Lozoya ran Pemex from 2012 until 2016, when he stepped down to make way for a new chief executive tasked with cutting costs in a global oil market rout.

Pemex declined to comment on issues related to Odebrecht, citing the ongoing investigation. It said the fertilizer plant it bought from AHMSA, which had not operated for 18 years before the purchase, has been renovated and is now running.

Mexico’s Congressional auditor, ASF, has criticized various transactions Lozoya led at Pemex, including contracts with Odebrecht and the fertilizer plant purchase.

In one report, ASF analyzed trips taken by Lozoya and Pemex aides in a helicopter he purchased as chief executive. They found the helicopter took 54 trips in 2015 to the Mexico City offices of Grupo Acerero del Norte (GAN), the holding company that owns AHMSA.

Orduna, the AHMSA spokesman, said that Lozoya used the heliport, but did not necessarily visit the company itself.

Lozoya’s lawyer said that not all the trips were taken by his client. Other Pemex officials used the helicopter, he added, explaining that GAN’s heliport is close to Pemex offices and was sometimes used for logistical purposes. (Reporting by Christine Murray; Additional reporting by Ana Isabel Martinez and Lizbeth Diaz; editing by Clive McKeef)

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