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Probe finds terrible working conditions at Brazil's Brenco

A team from Brazil's Labor Ministry found "degrading" living conditions for 133 sugarcane workers employed by an ethanol company whose investors include former US president Bill Clinton and other high-profile financial players.

At five sites inspected, workers "complained they were suffering from hunger and cold, and all of the locations were overcrowded and with terrible sanitary conditions," Jaqueline Carrijo, who led the inspections last month, said in a statement on Friday.

The target of the probe, Brazil Renewable Energy Co, -- known as Brenco -- apologized over the weekend and said it is fixing the problems at its rural operations, which turn sugarcane into ethanol.

Clinton's connection is via an investment in Brenco by The Yucaipa Cos, a US-based fund in which Clinton was a senior adviser until last year. His investment in Brenco is valued at between US$15,001 and US$50,000, said a financial disclosure report submitted last year by his wife, presidential candidate Hillary Rodham Clinton.

Yucaipa, whose chairman is prominent Democratic billionaire Ron Burkle, holds an overall 2.8 percent stake in the initial US$200 million raised by Brenco last year to start up operations in Brazil's booming ethanol sector.

Bill Clinton spokesman Matt McKenna said the former president's investment made via Yucaipa was small but that he had been assured Brenco was "committed to the highest ethical standard with regard to the treatment of its work force and of the environment."

"The president finds these allegations deeply troubling and expects Brenco to move swiftly to ensure that those responsible are held accountable," McKenna said, adding that Clinton is "taking steps to ensure that there is an appropriate transition for his business relationships should Senator Clinton become the Democratic nominee."

The Brazilian labor probe focused mostly on living conditions for the workers, including 17 who were paying rent to live in housing overrun by rats and cockroaches, Carrijo said.

In addition, trucks lacked special seatbelts for workers who ride atop the vehicles as they throw sugarcane seedlings to the ground, she said.

Brenco chief executive Henri Philippe Reichstul personally inspected the living arrangements of his company's workers on Monday. He said in an interview that the 17 workers cited by Carrijo were not living in company housing, but that the company agreed with labor inspectors that there were housing problems for the remaining 116 workers.

No workers are "in this situation anymore," he said. "If there are fines to pay for it, we will pay the fines. We are not breaking the spirit or the confidence that we got from our shareholders to start a project of sustainable growth."
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