FBI and Brazilian Authorities are Investigating Four Multinationals

By Harold Emert

RIO DE JANEIRO, BRAZIL – The FBI is investigating four giant multinationals–Johnson & Johnson, Siemens, General Electric and Philips–for the alleged payment of bribes to sell medical equipment in Brazil.

As a result of parallel investigations, the Brazilian Public Ministry suspects that the firms being investigated by American officials made illegal payments to public authorities to guarantee public health contracts during the last two decades.

Brazilian authorities say that more than twenty firms have participated in a cartel which paid bribes and charged inflated prices for medical equipment, including machines for magnetic resonance as well as prostheses.

Together, the four multinational firms have a net worth of US$600 million. Federal prosecutor Marisa Ferrari, in Rio de Janeiro, says authorities from the U.S. Justice Department and Securities and Exchange Commission (SEC) are aiding the Brazilian investigation.

“We are always sharing information on this investigation with the FBI. They have requested documents which we are sending, and they are conducting their own investigation as well. We have already received much information from the Justice Department and SEC”.

The payoffs are “enormous”, and she adds: “Because the budget for health care in Brazil is huge.”

“Besides paying bribes via intermediaries to guarantee contracts, some Brazilian providers are jacking prices up to eight times their real value,” adds the Prosecutor Ferrari.

GE in Boston, Philips in Amsterdam, and Johnson & Johnson in New Brunswick, New Jersey, have all acknowledged they are being investigated and are cooperating.

Siemens, based in Munich, Germany, says: “We have no knowledge that we are being investigated by the FBI but we are always willing to cooperate.”