Governing party treasurer arrested in Brazil kickback case

RIO DE JANEIRO (AP) — Federal police on Wednesday detained the treasurer of Brazil's governing Workers' Party in the wide-ranging investigation into corruption at state-run oil giant Petrobras, and the party said later he had asked to resign the post.

Joao Vaccari Neto was detained in Sao Paulo as he was heading out for an early morning jog, police and judicial officials told reporters at a news conference in the southern city of Curitiba, where the investigation is being led.

An arrest warrant also was issued for Vaccari's sister-in-law and his wife was questioned in connection with a series of unidentified deposits in her account that investigators suspect might be related to the kickback scheme at Petrobras.

Vaccari has maintained his innocence, telling a congressional panel last week that all the donations made to his party during last year's campaign were perfectly legal. His lawyer could not be reached for comment Wednesday.

Workers' Party President Rui Falcao said in a statement posted on the party's website that "for practical and legal matters Vaccari asked to step down as the party's treasurer."

But Falcao also called Vaccari's arrest unnecessary and expressed confidence in his innocence.

"We reaffirm our confidence in Joao Vaccari's innocence not only because of his conduct as treasurer, but also because in a democracy everyone is innocent until proven guilty," his statement said. "The party is confident that in the end truth will prevail."

Workers' Party Congressman Siba Machado told reporters the party called an emergency meeting to discuss Vaccari's arrest.

More than 100 people have been charged in connection with the Petrobras case, and more than 50 politicians are under investigation. Among those are two former chiefs of staff to President Dilma Rousseff, but Vaccari is the seen as closest figure to the president yet implicated in the scandal. Rousseff herself, who served as chairwoman of Petrobras' board during several years as the graft took place, isn't implicated.

Vaccari was detained "preventatively" and would be taken to Curitiba to testify, investigators said.

He was charged last month with corruption and money laundering in connection with the scheme, which prosecutors have described as the biggest ever uncovered in Brazil. According to federal prosecutors, big construction and engineering firms paid at least $800 million in bribes and other funds in return for inflated contracts with Petrobras, which is Brazil's biggest company. Part of that money allegedly went to the Workers Party and other parties for political campaigns.

At Wednesday's news conference, federal police officer Igor Romario de Paula said officials had been collecting evidence against Vaccari "for a long time."

He said the judge in the case, Sergio Moro, decided to order Vaccari's detention due to his "criminal habits, recidivism, a clear danger to public order and because of the kind of projection he has, the influence of the job he has today and the possibility of his fleeing."

The newspaper Folha de S.Paulo quoted Moro as suggesting the arrest order was prompted by worries that Vaccari, who is still treasurer of Rousseff's party, might be able to influence the investigation.

"Those who stand accused of such serious crimes, including the utilization of the position of treasurer of a political party to raise criminal resources and corrupt the political system, present a risk to public order," Moro was quoted as saying. "In such a position of political influence, he could continue in his criminal behaviors and even get in the way of the investigations."

Brazilian law sets no limit to how long those under preventative arrest can be detained.