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Alckmin keeps those involved in the cartel in office.

Warnings from the São Paulo State Court of Auditors regarding bribery payments and damage to public funds continue to be ignored by PSDB governments, according to IstoÉ magazine; directors of CPTM and the Metro were fined for harmful conduct, but have not been dismissed by the state administration.

Warnings from the São Paulo State Court of Auditors regarding bribery payments and damage to public funds continue to be ignored by PSDB governments, says IstoÉ magazine; directors of CPTM and the Metro were fined for harmful conduct, but were not dismissed by the state administration (Photo: Gisele Federicce)

Current Brazil Network - The PSDB government in São Paulo is ignoring warnings from the State Court of Auditors regarding the cartel operating in public transportation contracts and is keeping employees suspected of defrauding public funds in their positions. A report in IstoÉ magazine shows that directors of the Companhia Paulista de Trens Metropolitanos (CPTM) and the Metro have been fined for harmful conduct, but have not been dismissed by the state administration.

The publication reports that 15 contracts signed between companies belonging to the cartel denounced this year and São Paulo state-owned companies were deemed irregular by the TCE (Court of Accounts of the State of São Paulo), mostly due to bid rigging or amendments considered detrimental to the state government. The oversight body has repeatedly fined public officials, totaling R$ 145,2. Among those fined are Sérgio Henrique Passos Avelleda, former president of the São Paulo Metro and CPTM (São Paulo Metropolitan Train Company), and Mário Fioratti Filho, current director of operations for the Metro.

According to the president of the TCE (Court of Accounts of the State of São Paulo), Antonio Roque Citadini, this type of fine is equivalent to a "dirty record," meaning it should result in the dismissal of those involved. However, in addition to Fioratti Filho, Décio Tambelli, former director of the Metro and currently coordinator of the Monitoring Commission for Concessions and Permits of the Metropolitan Transportation Secretariat, and the director of operation and maintenance of CPTM (São Paulo Metropolitan Train Company), José Luiz Lavorente, remain in public service. A former executive of the German multinational Siemens, a whistleblower and participant in the scheme, says that the two participated in the scheme of paying bribes to public officials and politicians from the PSDB (Brazilian Social Democracy Party) in exchange for obtaining overpriced contracts with state-owned companies.

This week, the president of Siemens in Brazil, Paulo Ricardo Stark, attributed the delay in informing public authorities about the existence of a cartel operating in transportation bids with the governments of São Paulo and the Federal District to the complexity of internal investigations, even though the company has known since 2008 that there is a scheme operating internationally.

Investigations have also shown that in the same year, the State Public Prosecutor's Office was alerted by opposition deputies to the PSDB government about the existence of the collusion, but only this year did prosecutors decide to start an investigation, after the scheme came to light. IstoÉ showed that the participating companies disbursed the equivalent of R$ 100 million in bribes to public officials and PSDB politicians, in relation to contracts totaling at least R$ 12,6 billion.

According to testimonies obtained by the magazine, Governor José Serra himself, who was in charge of the Palácio dos Bandeirantes between 2007 and 2010, even proposed to executives that they divide the profits equally to avoid potential legal challenges that could hinder the completion of bidding processes.

At the end of September, the Federal Court lifted the bank and tax secrecy of 11 people investigated in the case. Among them is the city councilor of the capital, Andrea Matarazzo (PSDB), who was Secretary of Energy and president of the São Paulo Energy Company (CESP) and the Metro, in addition to having headed the Secretariat of Communication of the Presidency of the Republic during part of the Fernando Henrique Cardoso government (1995-2002).