Brazil investigates royalty overpayment
Brazil's federal police is investigating alleged irregularities in the payment of royalties from state-run Petrobras to city halls in Rio de Janeiro state.
Suspicion is focused in the state's north region, which receives royalties from production in the prolific Campos basin, the biggest oil-producing zone in the country.
The probe started in 2007 after the police discovered royalty payments that appeared to be above the amounts some cities were intended to receive.
According to the investigation, Victor Martins, one of the directors of oil and gas regulator ANP, allegedly used privileged information to acquire contracts with city halls to increase, approve or include oil royalties.
His name is expected to be mentioned in an upcoming intelligence report from the federal police, O Globo newspaper reported.
According to Veja magazine, Martins is under investigation for taking part in a scheme to arrange the payment of 1.3 billion reais ($590 million) in royalties to local governments.
The deal yielded a 260,000-reais commission to Martins' consulting company Analise Consultoria e Desenvolvimento.
One of the company's partners is Martins' wife Josenia Bourguignon Seabra.
Martins has denied the company has any contracts with any city hall and said he has not managed the company since 19 May 2005, one day before taking over his post at ANP.
Last year, 87 cities in Rio de Janeiro received a total of 3.4 billion reais in royalties and special participation, InfoRoyalties said.