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article imageBrazilian tycoon leaves prison, enters family feud

By Sebastian Smith (AFP)     Dec 16, 2017 in World

The good news for Marcelo Odebrecht, the tycoon at the center of Brazil's biggest ever corruption scandal, is he'll be out of prison Tuesday, in time for Christmas. The bad news: not all his family is celebrating.

The former CEO of Latin America's biggest construction company, the family firm Odebrecht S.A., will leave prison in the southern city of Curitiba after serving two and a half years of a 10-year sentence for money laundering and bribery. For the remainder, Marcelo Odebrecht will be under house arrest in Sao Paulo.

But while the courts have finished with Odebrecht for now, a feud with his father and other members of the powerful family looms, raising questions over the futures of the man once known as "the prince" and the giant company that once embodied Brazil's rise.

Building everything from the Miami Heat basketball arena to a hydroelectric dam in Angola, Odebrecht S.A. is no ordinary company. At the peak of his powers as CEO, the wiry, intense-looking Marcelo Odebrecht was one of the most influential people in Brazil.

But in 2015 he was arrested and later convicted for his central role in the "Car Wash" embezzlement and bribery scandal that three years later continues to shake Brazil's elite.

The revelation that he'd been greasing the palms of politicians to obtain contracts in a string of countries triggered the "prince's" brutal downfall. And when the full scope became clear -- Odebrecht S.A. even had a dedicated corporate department of bribes -- the company itself was thrown into peril.

- Swapping cell for condo -

A logo of Odebrecht is seen at the Olympic and Paralympic Village in Rio de Janeiro in 2016
A logo of Odebrecht is seen at the Olympic and Paralympic Village in Rio de Janeiro in 2016
YASUYOSHI CHIBA, AFP/File

Odebrecht's Curitiba lock-up has been relatively cushy. Cell doors are left open, there's a microwave, fridge and television, and the 49-year-old ex-CEO has reportedly become something of a fitness fanatic during his incarceration.

However, house arrest will be a lot pleasanter.

According to Brazilian press reports, Odebrecht and a police escort will likely fly to Sao Paulo on a private jet. He will then check into his house in the ultra-posh Morumbi neighborhood, where he lives with wife Isabel and their three daughters.

A spokeswoman for the "Car Wash" probe's headquarters confirmed that Odebrecht must spend the next two and a half years at home with a monitoring anklet. Another two and a half years will follow with daytime excursions allowed, before a final period in which he needs to be at home only on weekends.

The home is in one of Sao Paulo's most exclusive and heavily guarded gated communities and sprawls across 32,292 square feet (3,000 square meters), with a huge swimming pool, according to local media reports.

As far as golden cages go, this one glitters.

- Family feud -

What Odebrecht won't get is back to business as usual.

Much of his family's construction behemoth was dragged into the "Car Wash" pay-to-play scandal. However, Odebrecht is the one accused of ramping up graft to industrial levels upon taking over in 2008.

When investigators closed in, he defiantly tried to prevent a plea bargain.

However, his father Emilio spearheaded negotiations with prosecutors, according to Globo and other local media, and eventually 77 company executives, including Marcelo, spilled the beans on their mass bribery of politicians.

The company ended up agreeing to pay a whopping $2.6 billion in fines to the Brazilian, Swiss and US governments.

In return, the judge gave Marcelo a reduction in his original 19 year sentence to 10 years, lenient treatment for his father and a chance for the company to recover.

That surrender, say multiple Brazilian media reports, left the family bitterly split.

Marcelo Odebrecht's father is reported by the Globo to have visited him just twice in prison, while Folha de S. Paulo reports that he has also become estranged from his sister, mother, and several major figures from the firm. Three uncles sided with the father, just one with the son.

"There were two groups in the company," an Odebrecht board member told the UOL news site. "Emilio's side won."

Odebrecht S.A. is going through a profound makeover and on the eve of Marcelo's release, father Emilio, 72, announced the latest reforms: he is resigning as chairman of the board and from now on family members will not be able to serve as CEO.

Daniel Vargas, a professor at the Getulio Vargas Foundation in Rio de Janeiro, says the company is "making big efforts" to break with the old way of doing business, but that the whole country needs to show it can also change after "Car Wash."

Success for the company's new direction will depend on the rest of the market also turning honest. Otherwise, "if Odebrecht don't take part in corruption, how are they going to remain competitive?"

For the ambitious Marcelo Odebrecht, there are no easy paths either.

"I don't know how he will handle himself," Vargas said, "but it is sure that he has been deeply impacted by these scandals."

Out for the holidays, yes. But as the daily Folha says: "There'll be no party."

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