Gates foundation sues Brazilian oil company

The Bill and Melinda Gates Foundation supposedly lost millions due to the lies and corruption of one Brazilian oil company.

The foundation is suing on its own, suggesting it believes it might recover more of its losses on Petrobras’ American depositary shares that way. Media reports claim the Foundation is seeking “damages” related to its investment in Petrobras.

The Bill and Melinda Gates Foundation Trust sued Petroleo Brasileiro SA and a unit of PricewaterhouseCoopers LLP over a multibillion-dollar bribery scandal that knocked tens of billions of dollars off the Brazilian oil giant’s market value.

“This case arises from a pervasive bribery and money-laundering scheme carried out by Petrobras and willfully ignored by PwC”, Kenneth Warner, lead attorney representing the claimant, said in a complaint. Other USA investors have also filed lawsuits against the company.

“The depth and breadth of the fraud within Petrobras is astounding”.

“Equally breath-taking is that the fraud went on for years under PwC’s watch, who repeatedly endorsed the integrity of Petrobras’s internal controls and financial reports”. “This is a case of institutional corruption, criminal conspiracy and a massive fraud on the investing public”, the lawsuit said.

The value of Petrobras’ stock on the New York Stock Exchange has fallen to $1.70, from about $8 a year ago.

The trust joins a growing list of complainants, like WGI Emerging Markets Fund, which joined in the Thursday’s suit.

Portfolio managers for Gates and WGI probed Petrobras executives on questionable financial data, but were misled in a “series of materially false and misleading written and oral statements and/or omissions by Petrobras and/or PwC”, according to the complaint. Lawyers for the trust did not respond to requests for comment.

Prosecutors in Brazil say Petrobras executives colluded with construction companies to massively overbill the state oil giant.

The Gates Foundation is a charity that distributes money to grantees working on everything from the eradication of polio to helping small coffee farmers. It was established in the year 2000 by the Microsoft co-founder and his wife with the aim of improving health and education as well as alleviating poverty.