Brazilians protesting corruption scandals

Corruption scandals are a central part of Brazilian politics. Since the democratization of the country, every administration has had a scandal to call its own. From Fernando Collor, impeached due to a campaign financing scandal, past Lula, arrested in April 2018, all the way to current president Michel Temer, who dodged two indictment requests in 2017. And ever since Operation Car Wash was launched in 2014, it seems that not a week goes by without a new corruption accusation coming to light.

That explains why levels of public trust in Brazilian institutions are so low. Nearly all institutions have lost prestige, according to a recent Ibope Inteligência poll. Even the Armed Forces, which had gained popularity points over the past three years, are now trusted less. According to Transparency International, Brazil is ranked 79th of 179 countries in the NGO’s perception of corruption ranking. While that may not paint a particularly promising picture, the truth is that Brazil has taken steps towards fighting corruption.

One of these steps is a recent report by the Federal Accounting Court (TCU) – a sort of audit tribunal that monitors public spending to curb corruption at the federal level. The TCU analyzed Brazil’s federal institutions to measure their capacity to avoid corrupt practices from their staff. The results are, however, worrisome. A total of 38 federal agencies and entities—with a combined budget of BRL 216 billion—”have shown frail controls” in their contracts. According to the study, vulnerability levels are “high” and, in many cases, “very high.”

The report will be sent out to the president’s office and to President-elect Jair Bolsonaro’s transition team.


How susceptible to corruption are Brazil’s public institutions?

economic power corruption

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A total of 287 institutions attached to the Executive branch were scrutinized, including state-run companies of the caliber of Petrobras, the National Development Bank (BNDES), and Caixa (Brazil’s biggest completely state-owned bank). Departments such as the Attorney General’s Office and the National Transportation Infrastructure Department were also put under the microscope.

The report begins by describing the situation of the most robust public institutions. Eight out of 10 of them “still show only basic levels of risk management and internal controls,” says the TCU. And 90 percent of these institutions “have never passed the initial stage of the process to implement controls to avoid fraud and corruption.” Also according to the report, “of the 102 institutions with the largest budgets, 70 percent have no ethics policy.”

The TCU has criticized the “absolute and general lack of minimum and objective criteria for the nomination of executives.” Besides, “state-owned companies with more economic power have advanced little in establishing transparency and accountability practices.” And that includes Petrobras, which was at the center of Operation Car Wash.

Unfortunately, this shows that Brazil’s leadership has learned nothing from the past four years. 


On December 3, the TCU will invite all concerned institutions for a meeting, where it will present individual reports on each of them, highlighting the specific points that make them more exposed to fraud and corruption. 

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PowerNov 24, 2018

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BY The Brazilian Report

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