Brazil police seek former billionaire Batista in graft probe


 Reuters International

Brazilian tycoon Eike Batista walks as he leaves his court hearing in Rio de Janeiro November 18, 2014. REUTERS/Ricardo Moraes

(reuters_tickers)

By Pedro Fonseca and Rodrigo Viga Gaier

RIO DE JANEIRO (Reuters) - Brazilian police are seeking the arrest of fallen commodities tycoon Eike Batista as part of a vast political bribery probe, investigators said on Thursday, adding that the former billionaire appeared to have already flown to New York.

Batista, Brazil's richest man just five years ago, seems to have left the country on a German passport on Tuesday night and will be considered a fugitive if he does not surrender soon to authorities, police investigator Tacio Muzzi told reporters.

Representatives for Batista confirmed that he was outside of Brazil, citing professional obligations. They said he had offered to cooperate with investigations and would soon present himself to authorities, without commenting on allegations of criminal behaviour.

Globo TV reported late on Thursday that Batista would fly back from the United States to Brazil on Friday, citing his lawyers. The report could not be immediately verified.

Police said they believe Batista and eight others facing detention orders on Thursday took part in a $100 million money laundering ring tied to kickbacks on lucrative contracts in a scheme centred on state-run oil firm Petrobras.

"We can't categorically affirm that there was an intention to flee," said Muzzi. Globo TV reported he had arrived in New York.

Brazilian police asked Interpol to issue a international "red notice" calling for Batista's arrest, according to a police media representative.

Batista's arrest would cap a dramatic fall for a man who was among the 10 richest in the world before the global commodities crash hammered the business empire he has been forced to sell.

One of Brazil's most outspoken entrepreneurs, Batista's fortune has dwindled from more than $30 billion to nearly nothing as his Grupo EBX, a constellation of energy, mining and transportation companies, crumbled in recent years.

Two of the companies that filed for bankruptcy protection, miner MMX Mineração e Metalicos SA and shipbuilder OSX Brasil SA, said in securities filings that the legal proceedings against Batista would have no effect on them.

Prosecutors said Batista had paid a roughly $16 million bribe in 2011 to former Rio Governor Sergio Cabral, who was arrested in November on corruption charges. Investigators did not specify what advantages Batista allegedly gained, but said he was part of the corruption and money laundering operation.

WIFE AND CHILD

Brazil and the United States signed an extradition treaty in 1961. Police told a news conference earlier on Thursday that they could not yet be certain whether Batista had boarded the flight to New York with a ticket bought in his name or whether he might have flown onward from there.

Batista has family ties to Germany, which does not have a formal extradition treaty with Brazil but has collaborated in the past on high-profile criminal cases.

A federal police source told Reuters that it appeared Batista was followed to New York the next day by his wife and one of his children.

Police declined to say where Batista would be jailed once apprehended.

Inmates with a college degree, which Batista lacks, are usually separated from the rest of the population in Brazil's crowded and chaotic prison system, which has suffered a series of violent riots this year.

The collapse of Grupo EBX has already triggered fraud investigations into Batista. A ruling by Brazil's securities watchdog CVM in November 2015 barred him from any management role at publicly traded companies for five years. Regulators are also looking into allegations of insider trading by Batista.

Last year Batista testified in the sweeping Petrobras case that former Finance Minister Guido Mantega had allegedly solicited an illegal contribution to the ruling party at the time. Mantega has repeatedly denied the accusations.

(Additional reporting by Lisandra Paraguassu in Brasilia, Marta Nogueira in Rio de Janeiro; Writing and additional reporting by Guillermo Parra-Bernal, Brad Haynes and Tatiana Bautzer in Sao Paulo; Editing by Daniel Flynn, Meredith Mazzilli and Bill Rigby)

Reuters

 Reuters International