Petrobras scheme started with Lula’s ex-chief of staff -prosecutor

SAO PAULO (Reuters) – A massive corruption and political kickback scheme at Brazil’s state-run oil company Petrobras started with former president Luiz Inacio Lula da Silva’s chief of staff, a lead prosecutor said yesterday.

Prosecutor Carlos Fernando dos Santos Lima said the bribery scheme at Petroleo Brasileiro SA, as Petrobras is formally known, had the same origins as Brazil’s previous political scandal, the “mensalao” or monthly payment scheme, in the offices of Jose Dirceu, Lula’s top aide from 2003 to 2005.

Dirceu was charged with corruption, money laundering and racketeering on September 4 in the Petrobras case after being arrested in August.

He was already under house arrest for the earlier corruption case.

“We don’t have concrete proof, but we are working with the hypothesis that everything started with the chief of staff,” Lima said.

Lima pointed to Dirceu as the mastermind of the graft cases during a news conference to announce the arrest of Jose Sobrinho, one of three owners of construction firm Engevix, for allegedly paying bribes between 2011 and 2013 to executives at Eletronuclear, a unit of state-run electric utility Eletrobras .

Lima’s comments on the origins of Brazil’s largest-ever corruption case may bring the scandal closer to Lula, a beloved leader credited with lifting millions of Brazilians out of poverty. Brazilian police are preparing to question Lula about the Petrobras scandal, after getting approval to do so from the Supreme Court.

Neither Lula nor his successor, President Dilma Rousseff, have been charged, and both deny any role in the kickback scheme. Rousseff was Lula’s chief of staff after Dirceu.

Also yesterday, the treasurer of the governing Worker’s Party, Joao Vaccari, was sentenced to just over 15 years in jail, while the former head of Petrobras’ services division, Renato Duque, faces 20 years and eight months.

The Workers’ Party said the conviction of Vaccari lacked proof and would be appealed. It said in a statement that all donations handled by Vaccari were duly reported to electoral authorities and were similar amounts to those received by other major Brazilian parties.

Duque’s lawyers are trying to negotiate a plea deal and the sentences can be appealed.

Moro said bribes from Petrobras’ services division were passed on to Vaccari in the form of campaign donations.

Dozens of leading Brazilian executives and politicians have been arrested or are under investigation for overcharging Petrobras and other state firms and using the excess to bribe politicians.

Engevix did not immediately respond to request for comment.