- Title: Former FM Antonio Palocci detained in graft probe
- Date: 26th September 2016
- Summary: RIO DE JANEIRO, BRAZIL (FILE) (REUTERS) OIL PLATFORM (SOUNDBITE) (Portuguese) FEDERAL PROSECUTOR, LAURA GONCALVES TESSLER, SAYING: "The money has not been completely traced, investigations continue and that is why we are taking the measures today to have more elements on the recipients, how the transactions were made, where the money is, the concern is to ensure the recovery of the assets which were diverted from Petrobras." RIO DE JANEIRO, BRAZIL (FILE) (REUTERS) PETROBRAS LOGO OIL TANKER
- Embargoed: 11th October 2016 17:07
- Keywords: Brazilian police arrest Antonio Palocci a former finance minister presidential chief of staff Workers Party governments anti-corruption probe
- Location: ATIBAIA + BRASILIA + CURITIBA + RIO DE JANEIRO + SAO PAULO, BRAZIL
- City: ATIBAIA + BRASILIA + CURITIBA + RIO DE JANEIRO + SAO PAULO, BRAZIL
- Country: Brazil
- Topics: Crime/Law/Justice,Crime
- Reuters ID: LVA004517DNPF
- Aspect Ratio: 16:9
- Story Text: EDITORS PLEASE NOTE: THIS EDIT CONTAINS VIDEO WHICH WAS ORIGINALLY 4:3
Brazilian police on Monday (September 26) arrested Antonio Palocci, a former finance minister and presidential chief of staff in recent Workers Party governments, as a sweeping anti-corruption probe reached ever closer to the heart of the left-leaning party.
Authorities told a news conference that Palocci acted as a liaison between the Workers Party and Latin America's largest engineering and construction conglomerate, Odebrecht SA, between 2006 and 2013 in a political kickback scheme centred on contracts at state-led oil company Petroleo Brasileiro SA, or Petrobras.
"The payments were (made) to a current account that Odebrecht (Construction magnate Marcelo Odebrecht) had with the Workers Party due to the interferences in this case, mainly from Antonio Palocci Filho (a former finance minister and presidential chief of staff in recent Workers Party governments) in favour of the company in diverse projects," Federal police delegate, Felipe Pace said.
Palocci was former president Luiz Inacio Lula da Silva's finance minister and chief of staff to ex-president Dilma Rousseff, who was ousted in August in an impeachment trial that ended 13 years of Workers Party rule.
His lawyer did not immediately respond to requests for comment.
Palocci's arrest brings the investigation of Brazil's biggest ever corruption scandal into the core leadership of the Workers Party. Last week, police briefly arrested Guido Mantega, who succeeded Palocci as Lula's finance minister and stayed in the post for almost nine years.
Mantega had been arrested on a temporary detention warrant and was released after a few hours in custody. Palocci was picked up on the same warrant, which could mean his detention will also be brief.
Federal prosecutor Laura Goncalves Tessler told the same news conference the exact path the money took, would need to be investigated.
"The money has not been completely traced, investigations continue and that is why we are taking the measures today to have more elements on the recipients, how the transactions were made, where the money is, the concern is to ensure the recovery of the assets which were diverted from Petrobras," Goncalves said.
Investigators allege Palocci improperly approved loans from state development bank BNDES to Odebrecht in Africa and for oil platforms. They also allege that he pushed legislation through Congress to help the company win tax advantages.
Prosecutors said they had found evidence that Odebrecht paid 128 million reais ($39.5 million) to the Workers Party and its representatives between 2008 and 2013, including Palocci.
Pace agreed more investigations are needed.
"Here there is a need for further investigation as Jose Carlos Costa Bumlai (businessman friend of former president Luiz Inacio Lula da Silva) when he gave his statement said it was Marisa Leticia (wife of Lula) and Jacob Bittar (unionist friend of Lula) who were responsible for starting to look for businessmen to launch the Lula Institute with," Pace said.
Lula was indicted last week on corruption charges in a case involving a luxury seaside apartment that prosecutors says was a disguised bribe from a construction company implicated in the Petrobras scheme. Still Brazil's most popular politician, his arrest is unlikely before he goes on trial.
Construction magnate Marcelo Odebrecht, whose family owns the group Odebrecht SA, received a 19-year sentence in March for bribery, money laundering and organized crime in relation to the scandal at Petrobras.
Two other people were arrested in Monday's raids, both former aides of Palocci.
Odebrecht's press office said the company would not comment. BNDES officials did not immediately respond to a request for comment.
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