(Adds economic impact, comments from prosecutor-general on Monday)
By Anthony Boadle
BRASILIA, March 3 (Reuters) - Brazil’s top prosecutor asked the Federal Supreme Court on Tuesday to open investigations into politicians who allegedly benefited from a multibillion-dollar kickback scheme at state-run oil company Petrobras, a court official said on Tuesday.
The request for authorization to probe elected officials expands the country’s biggest corruption scandal to the political realm, further rattling President Dilma Rousseff’s administration at a time when it is already struggling to contain the economic fallout from the case.
The official, who asked not to be named because the case is still under secrecy provisions, said Prosecutor-General Rodrigo Janot asked the court to authorize 28 separate investigations into 54 people, many of whom are expected to be politicians.
Janot’s office did not release the names of the politicians, but plea bargain testimony by defendants in the case leaked to local media indicate that most are members of the ruling Workers’ Party and coalition allies in Congress.
O Estado de S. Paulo and other newspapers said the list includes Senate President Renan Calheiros and Speaker of the Chamber of Deputies Eduardo Cunha, both the top leaders of Congress and members of the PMDB party, the largest ally in Rousseff’s ruling coalition. None of the papers said how they obtained the information.
Under Brazilian law, politicians and cabinet members can only be tried by the Supreme Court. The judge in charge of the case must decide whether to lift a secrecy provision and release the names and plea bargain statements.
The politicians were named by a former senior manager at Petrobras and a black market currency dealer whose arrest last March triggered an investigation into the funneling of money from overpriced infrastructure contracts into the pockets of corrupt executives and politicians.
Some of that money, prosecutors say, may have helped finance election campaigns for political parties, including Rousseff’s Workers’ Party and other members of her governing coalition.
The corruption probe, known as “Operation Car Wash,” has so far led to 40 indictments on racketeering, bribery and money laundering charges. Officials have indicted two former senior managers at Petroleo Brasileiro SA as the company is formally called and 23 executives from six of Brazil’s leading construction and engineering firms.
The scandal threatens to have a ripple effect on Brazil’s already weak economy, prompting Petrobras to halt or cancel several investment projects. Companies in the oil and gas, construction and energy sectors are also finding it harder to obtain credit as banks retrench in the wake of the scandal.
Prosecutors are seeking the return from construction firms of about $1.6 billion siphoned off Petrobras contracts and are investigating Swiss bank accounts where funds were transferred and in some case laundered through off-shore front companies.
The investigation and possible trial of politicians by the Supreme Court could take years. Brazil’s largest political corruption case to date, involving monthly payments to lawmakers in return for support in Congress for the Workers’ Party, took seven years before it went to trial in 2012.
“The investigation has begun. We will take it to its end,” Janot said on Monday. “Those responsible will pay,” he told a group of anti-corruption demonstrators who held a sign outside his office that said “Janot, you are the hope of Brazil.”
Rousseff was chairwoman of Petrobras’ board of directors from 2003 to 2010, when much of the alleged corruption took place. She has denied knowing about the scheme during those years and has vowed to respect the Judiciary’s independence.
A recent opinion poll, however, showed three in four Brazilians believe Rousseff knew about the scam.
Barring the discovery of evidence that Rousseff benefited from kickback funds in her 2010 or 2014 election campaigns, even opposition leaders believe that recent calls for her impeachment will go nowhere. (Additional reporting by Nestor Rabello; Editing by Diane Craft, Guillermo Parra-Bernal, Richard Chang and Lisa Shumaker)