October 19, 2017 / 10:11 AM / in a year

Brazil's lower house passes bank leniency terms, higher fines

BRASILIA, Oct 18 (Reuters) - Brazil's lower house of Congress passed a bill late on Wednesday that raises maximum fines on financial institutions involved in illicit acts as part of efforts to tackle the country's worst ever corruption scandal.

The bill raises fines for banks to as much as 2 billion reais ($631.51 million) from 250,000 reais previously. It also allows the central bank to strike plea-bargain agreements with financial firms that admit breaching rules, in exchange for smaller fines or softer punishment terms for their executives.

Legislators and government officials sped up preparation of new rules for so-called bank leniency deals as they feared new disclosures snaring local financial firms in graft scandals, Reuters reported earlier this year.

Some of Brazil's largest companies, including meatpacker JBS SA and engineering conglomerate Odebrecht SA , have confessed to wrongdoing after investigators uncovered a giant corruption scheme involving the largest political parties.

The bank leniency deals will be limited to administrative sanctions, leaving prosecutors free to present criminal charges. The central bank will disclose the existence of leniency deals but keep strategic details under seal.

The bill, which still needs Senate approval, will replace a temporary executive decree, issued in June by President Michel Temer, that will expire later this week.

$1 = 3.1670 reais Reporting by Silvio Cascione; editing by Mark Heinrich

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