Brazilian police raided the offices of the construction consortium building one of the four main hubs for the Rio Olympics on Tuesday on suspicions of fraud and corruption.
The Deodoro site, which will host 11 of the sports in the first Olympics ever staged in South America, starting August 5, is in the north of Rio de Janeiro.
Federal police said in a statement that agents entered the offices of the consortium, headed by the OAS and Queiroz Galvao construction companies, to probe "fraud in the transport and destination of solid waste, involving falsifying of public documents and overbilling."
The offices of two other unnamed contractors were also searched.
According to the transparency ministry, corruption at Deodoro, where riding and rugby sevens are among the sports that will be hosted, has cost the public 85 million reais ($24.7 million).
Authorities have been probing the Deodoro complex since mid-2015 when the CGU, a public auditor tasked with checking use of federal funds, said it found irregularities. In March 128 million reais ($37 million) in funding was blocked.
At the time, the CGU said it had found "evidence of falsification in the registries regarding volume of waste from civil construction projects" from Rio de Janeiro to another city in the state.
The Deodoro Complex Consortium denied any wrongdoing.
"Changes in the cost of transporting waste materials is due to the increase in the quantity of material being transported, which did not match the initial project," it said in a statement.
"This change has not made an impact on the total value of works in the contract."
Both OAS and Queiroz Galvao have been implicated in the huge corruption scandal at state oil giant Petrobras, where a cartel of contractors, aided by politicians and executives, systematically overbilled the company.
The spokesman for the Rio 2016 organizing committee, Mario Andrada, said that there was no threat to preparations.
"We've been able to keep a dialogue with society without hiding anything under the carpet and there is no skeletons in the closet," he told journalists.
"We ensure that with the companies we have, with the standards we have, we are going to be ready to deliver great games."
A spokesman for the Rio mayor's office said "we know nothing about" the Deodoro issue.
Brazilian police raided the offices of the construction consortium building one of the four main hubs for the Rio Olympics on Tuesday on suspicions of fraud and corruption.
The Deodoro site, which will host 11 of the sports in the first Olympics ever staged in South America, starting August 5, is in the north of Rio de Janeiro.
Federal police said in a statement that agents entered the offices of the consortium, headed by the OAS and Queiroz Galvao construction companies, to probe “fraud in the transport and destination of solid waste, involving falsifying of public documents and overbilling.”
The offices of two other unnamed contractors were also searched.
According to the transparency ministry, corruption at Deodoro, where riding and rugby sevens are among the sports that will be hosted, has cost the public 85 million reais ($24.7 million).
Authorities have been probing the Deodoro complex since mid-2015 when the CGU, a public auditor tasked with checking use of federal funds, said it found irregularities. In March 128 million reais ($37 million) in funding was blocked.
At the time, the CGU said it had found “evidence of falsification in the registries regarding volume of waste from civil construction projects” from Rio de Janeiro to another city in the state.
The Deodoro Complex Consortium denied any wrongdoing.
“Changes in the cost of transporting waste materials is due to the increase in the quantity of material being transported, which did not match the initial project,” it said in a statement.
“This change has not made an impact on the total value of works in the contract.”
Both OAS and Queiroz Galvao have been implicated in the huge corruption scandal at state oil giant Petrobras, where a cartel of contractors, aided by politicians and executives, systematically overbilled the company.
The spokesman for the Rio 2016 organizing committee, Mario Andrada, said that there was no threat to preparations.
“We’ve been able to keep a dialogue with society without hiding anything under the carpet and there is no skeletons in the closet,” he told journalists.
“We ensure that with the companies we have, with the standards we have, we are going to be ready to deliver great games.”
A spokesman for the Rio mayor’s office said “we know nothing about” the Deodoro issue.
