Thursday, May 18, 2017

Brasil's President Temer Hit By Bribery Allegations

Brazil’s President Temer hit by bribery allegations Leader denies report he was taped approving payments to silence former coalition ally Read next Pensions at centre of Brazil’s reality check Michel Temer is facing the biggets crisis of his presidency but denies wrongdoing © AP Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) Email1 Save 3 HOURS AGO by: Andres Schipani in São Paulo Brazil’s Michel Temer is facing the biggest crisis of his short presidency after one of the country’s leading newspapers alleged he had been taped endorsing bribes to buy the silence of a former coalition ally in corruption investigations. O Globo reported that Joesley and Wesley Batista, respectively chairman and chief executive of Brazil’s largest meatpacker JBS, had presented a secret recording of Mr Temer approving bribes to Eduardo Cunha, the disgraced former speaker of the lower house, as part of plea bargain negotiations. The report comes as the country’s political and corporate establishment is still reeling from sprawling corruption investigations into state oil company Petrobras in a scandal known as Operação Lava Jato, or Operation Car Wash, which has implicated senior politicians, police, union bosses and indigenous leaders in a vast web of bribery. According to the O Globo report, Mr Temer heard from Joesley Batista that JBS was paying Cunha to keep silent. The president is alleged to have responded: “You’ve got to keep this up, OK?” The report did not specify what Cunha — who was crucial in the impeachment of former president Dilma Rousseff that brought Mr Temer to power last year — was alleged to have been asked to keep silent about. The president’s office said in a statement that Mr Temer had “never asked for payments to obtain the silence of the former deputy Eduardo Cunha”. Confirming the meeting with Joesley Batista at Mr Temer’s official residence, it added that “there was nothing in the dialogue that compromises the conduct of the president”. JBS declined to comment. Cunha, who is in jail, could not be reached for comment. FT Special Report Reinventing Brazil Brazil appears to be on the move again. After a rocky 2016, there are signs that the deep recession could be coming to an end.

Despite protests, the government is trying to cut back on spending and introduce changes that will ensure a more sustainable future. The unverified report is already rattling the unpopular government. Protesters gathered on Wednesday night outside Brasilía’s modernist presidential palace and in São Paulo’s main thoroughfare honking horns and shouting “Temer, out!” “If true, this is a bomb,” said Thomaz Favaro, political analyst at Control Risks, adding that if the recordings were confirmed, Mr Temer faced an investigation, public pressure to resign and impeachment proceedings in Congress. “The development substantially increases the risk of an unscheduled government change before the 2018 election,” he said. If Mr Temer left power, the next in line would be Rodrigo Maia, head of the lower house of Congress who is also implicated in the probes. Plea bargains in Brazil allow suspects to receive lighter sentences in exchange for giving evidence, which in the case of Operation Car Wash has led to investigation threads that have reached ever higher echelons of power. The latest batch of plea bargains prompted the Supreme Court to open probes in April into many politicians, including eight government ministers.

 Mr Temer, already suffering from an approval rating of just 9 per cent, is battling to introduce an ambitious reform agenda including deeply unpopular changes to the pension system. Not only could the latest revelations trample on his plan — they could conceivably topple him. Alessandro Molon, an opposition lawmaker, said he had filed an impeachment request against Mr Temer. Janaína Paschoal, a jurist and co-author of the impeachment request against Ms Rousseff, said on Wednesday night that if the recordings were confirmed, Mr Temer could not remain in office. Columnist Igor Gielow wrote in Folha de São Paulo newspaper that while a mixture of luck and skill had allowed Mr Temer to get through the car wash investigations so far, “now he can at the very least be accused of a crime . . . obstruction of justice”.