Construction Funds Blocked to Rio 2016 Deodoro Complex

(ATR) Courts in Rio de Janeiro blocked funds to be paid to the consortium in charge of venue construction at the Deodoro Olympic Complex.

According to a report from G1, the 3rd Criminal Court of Rio blocked a payment of $35 million from Brazilian bank Caixa to the consortium. The request was made to the court from the Federal Public Ministry (MPF), after receiving an audit from the Brazilian comptroller general (CGU). The report stated that prosecutors in Rio found evidence of fraud among payments for "earth moving services" in Deodoro.

The CGU confirmed to Around the Rings it had audited the complex and that all findings were send to the MPF.

"At the moment, we cannot detail the content of the works as the process under the MPF is confidential," a spokesperson for the CGU added to ATR.

The MPF would not comment on the case to ATR saying it is "being treated confidentially."

Brazilian bank Caixa confirmed to ATR that they have suspended payments to the Deodoro complex, "as a precautionary measure."

"Caixa understands that the proceeding is in progress and confidential," a spokesperson for the bank added. "We will seek further information from the federal prosecutors, to understand the need to adopt new measures."

The Olympic project has escaped corruption allegations so far. According to a report from Reuters, the two companies in charge of the Deodoro Complex consortium are Queiroz Galvão and OAS, both of which have been implicated in the Lava Jato corruption scandal. It is not clear if the current situation is connected to Lava Jato, or an independent investigation. The 2016 Olympic Games will open in just over four months.

Rio City Hall says it is complying with the investigation in a statement provided to ATR,and it was standard procedure for the government to audit all construction contracts.

"Rio City Hall respects and endorses the work done by the CGU and the MPF," the statement read. "If any proof of undue payment arises, such payment shall be refunded."

In the same statement, city hall said the payments were for the canoe slalom venue, but added that there is "no loss" to the venue even with the situation, since it had already been completed. Rio 2016 is currently in charge of the venue, along with most venues in the Deodoro complex.

The Rio 2016 organizing committee would not comment on the court case, but a spokesperson for the committee told ATR that the situation will not affect the temporary construction and overlay set to begin in Deodoro in the upcoming weeks.

Written by Aaron Bauer in Rio de Janeiro

20 Years at #1: Your best source of news about the Olympics is AroundTheRings.com, for subscribers only.