Israeli businessman arrested in Peru over massive graft scandal

An Israeli entrepreneur was reportedly arrested in Peru on Sunday over his alleged business links with a Brazilian construction company at the heart of a giant corruption scheme.

According to Peruvian media, Gil Shavit was arrested at the Jorge Chávez International Airport in Lima as he attempted to leave the country, Israeli and Peruvian media reported.

An arrest warrant was issued for Shavit after he ignored a police summoning to be questioned last week.

State prosecutors say Shavit has deep ties to ex-president Alejandro Toledo, who fled Peru in February after being charged with taking millions of dollars worth of bribes from the Odebrecht company.

The La Republica daily reported that Shavit is believed to have played a central role in securing a tender to build a trans-oceanic highway between Peru and Brazil on behalf of Odebrecht.

Toledo is accused of accepting $20 million in bribes from Odebrecht to advance the highway deal, and Shavit would have received $4 million for his role in the scheme, La Republica said.

Toledo, who Peruvian authorities believe is in the US, has denied all of the charges against him and claims to be the victim of a smear campaign. In February, Toledo, whose wife holds Israeli citizenship, was thought to be attempting to flee to the Jewish state aboard a San Francisco-Tel Aviv flight, but the Israeli Foreign Ministry made clear he was not welcome in the country.

According to Israel’s Channel 10, Shavit also has ties to another Israeli businessman, Yossi Maiman, whose Peru-based real estate firm Ecoteva Consulting was accused of laundering Toledo’s bribe money to offshore shell companies in Central America.

Maiman appeared in a Peruvian court in 2016 to testify over the affair, but was never charged in connection to the affair.

One of the region’s biggest construction companies, Odebrecht was at the heart of a scheme to bribe Brazilian state oil giant Petrobras in exchange for inflated contracts.

Odebrecht also reportedly systematically bribed Latin American politicians, even running a department to keep track of the bribery.

The construction giant admitted to paying $788 million in bribes across 12 countries and agreed with the US Justice Department to pay a $3.5 billion fine, a world record in foreign corruption cases.

Odebrecht has done major infrastructure work around the world. Last month, Brazilian authorities said they were scrutinizing at least 10 foreign companies in connection with the graft scandal.

The scandal has upended politics in Latin America as the continent struggles to cope with the worst recession in its history.

AFP contributed to this report.