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September, 28, 2016

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Brazil's ex-finance minister temporarily arrested

SAO PAULO--Brazilian police on Thursday briefly arrested the latest heavyweight implicated in a massive corruption scandal: former finance minister Guido Mantega, a key figure in the previous two governments.

Mantega, an important player in the leftist Workers' Party, was arrested at a Sao Paulo hospital where his wife was about to undergo surgery. He was held for several hours before the presiding judge agreed to let him return to his wife's bedside.

In between, federal police transferred him to the southern city of Curitiba, headquarters of the probe into a sprawling bribe and kickback scheme at state oil company Petrobras.

Mantega, 67, served in the cabinets of both president Luiz Inacio Lula da Silva — his fellow suspect in the Petrobras probe — and Lula's recently impeached successor, Dilma Rousseff.

Mantega is accused of asking business magnate Eike Batista for a bribe of five million reals (US$2.5 million at the time) in 2012 to help the Workers' Party pay off campaign debts, federal prosecutor Carlos Dos Santos Lima told a press conference.

The arrest is the latest phase of "Operation Car Wash," the federal probe into the Petrobras scheme, which has upended Brazilian politics since it was launched in 2014.

Under the scheme, Petrobras allegedly gave inflated contracts to big construction firms in exchange for hefty bribes, with high-ranking politicians taking a cut of the proceeds.

Dozens of politicians and some of Brazil's richest businessmen have been charged or convicted.

In the latest phase — dubbed "Archive X" — police said 180 agents fanned out across five states and the capital, Brasilia, to detain eight suspects, haul in another eight for questioning, and serve 33 related court orders.

New Twist

In a new twist in the investigation, Dos Santos Lima said police found evidence of contracts to build two major oil platforms awarded to companies "with no qualifications whatsoever."

One of the companies was shipbuilder OSX, which belonged to Batista — the businessman Mantega is accused of strong-arming in 2012, the year after Rousseff became president.

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 Night 3 of protests over police killings of black men 
Demonstrators shout slogans against Brazil's President Michel Temer during a protest in Rio de Janeiro, Brazil, Thursday, Sept. 22.


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