Dominican economist defended project as Odebrecht paid him

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Dominican economist defended project as Odebrecht paid him | Miami Herald

Influential economist defended construction giant. Secretly it paid his firm millions | Miami Herald

The Bribery Division: A look into Odebrecht’s bribery scandal

An investigation led by the International Consortium of Investigative Journalists reveals that Odebrecht’s cash-for-contracts operation was even bigger than the Brazilian company has acknowledged. Here's a look into the bribery scandal.

THE BRIBERY DIVISION

Influential economist defended construction giant. Secretly it paid his firm millions


By Ben Wieder,

Kevin G. Hall, and

Alicia Ortega Hasbún 

June 27, 2019 09:02 AM, Updated June 27, 2019 09:02 AM


As questions swirled about the ballooning price tag for a $2 billion coal plant in the Dominican Republic, one of the strongest defenders of the project was a prominent Dominican economist named Andrés Dauhajre Hijo.

Writing in the newspaper El Caribe in February 2017, Dauhajre called criticism of the Punta Catalina project’s costs “the best-selling lie in recent years.”

But Dauhajre’s accounting of the project left out one detail.

He didn’t disclose that he had been paid more than $3 million by Odebrecht S.A., the Brazilian construction firm that had won a 2013 contract to build the plant. That $3 million was on top of the money his consulting firm had previously received from the government to help review the bids of Odebrecht and others.

Those payments were among the revelations in a tranche of leaked data and documents obtained by the International Consortium of Investigative Journalists showing the inner-workings of Odebrecht’s Drousys system, an alternative accounting system the company used to keep track of $788 million worth of bribes and other off-the-books payments it doled out to politicians and government officials in 12 countries in Latin America and Africa.

Reporters from McClatchy, The Miami Herald and el Nuevo Herald are part of a team of more than 50 journalists in 10 countries who analyzed the leaked documents for more than four months.

The Drousys system showed payments connected to several projects in the Dominican Republic, including more than $3.3 million in 2014 paid to a shell company associated with Dauhjare, called Baker Street Financial Inc.

That same company — with Dauhajre listed as the sole director — purchased a $2 million midtown-Manhattan apartment in December 2015.


Deed for Manhattan apartment purchased by Baker Street Financial by Ben Wieder on Scribd


When confronted with records of the payments and property records linking him to the shell company, Dauhajre acknowledged that he had been paid by the Brazilian company for “financial consulting services,” helping the company shore up financing for the coal plant when its original financing fell through.

“Baker Street Financial Inc. successfully and effectively provided the advisory service requested by Odebrecht during the years 2014 and 2015,” Dauhajre said in the statement. “Several of the financing options proposed by Baker Street Financial Inc. to Odebrecht were presented and eventually accepted by the Dominican State, allowing the development of the Project to materialize.”

In the Dominican Republic alone, Odebrecht gave out $92 million to government officials and their intermediaries, part of a much broader pattern of corruption involving assorted countries, according to Odebrecht’s December 2016 plea agreement with the U.S. Department of Justice. Odebrecht S.A. agreed to pay a record $2.6 billion fine in the case.

So far, the Dominican Republic’s attorney general has determined that many of Odebrecht’s 17 projects in the country were associated with graft.

 

Andrés Dauhajre Hijo’s consulting firm helped the Dominican government evaluate proposals to build the Punta Catalina coal-fired plant. When Odebrecht won the contract, the firm was paid millions by the company for its advice.