Jailed Odebrecht CEO meets Brazil prosecutors for plea deal - report

BRASILIA, Aug 5 (Reuters) - The former chief executive of Brazil’s largest construction firm Odebrecht SA has been in hours of negotiations with prosecutors over a plea deal that would detail illegal campaign donations to dozens of senior politicians, the daily O Globo reported Friday.

The testimony of Marcelo Odebrecht, in jail since last year for his involvement in a colossal corruption scheme at state-run oil company Petrobras, would fall like a bomb on the political establishment in the capital Brasilia.

The meeting was the first between Odebrecht and prosecutors of the sweeping corruption investigation known as “Operation Carwash,” the paper said.

That tallied with comments by lead prosecutor Carlos Lima, who told Reuters in June that Odebrecht had not yet spoken to investigators, despite previous media reports that talks were already underway.

A spokesman for the prosecutor’s office declined to comment.

Odebrecht’s testimony threatens to tarnish the administration of interim President Michel Temer, who took office in mid-May when his predecessor Dilma Rousseff was sent for trial in the Senate on charges of breaking budget rules.

The two-year probe has uncovered a scheme in which engineering companies paid bribes to Petrobras executives and politicians to win profitable contracts.

Odebrecht has promised to present evidence of illegal payments to members of Temer’s government, 35 senators, 13 governors and dozens of mayors, the newspaper reported.

The investigation, which led to the arrest of some of the country’s richest businessmen and top politicians, has hobbled investment and fueled Brazil’s political crisis, contributing to Rousseff’s unpopularity.

Folha reported that 51 other Odebrecht executives could join the plea deal to detail the scheme that ran for years at the cost of billions of dollars to Petrobras.

A spokesman for Odebrecht could not be immediately reached for comment.

Temer, who was Rousseff’s vice president, has denied any links to the bribery scheme, but several senior lawmakers of his Brazilian Democratic Movement Party (PMDB) are under investigation for allegedly taking bribes.

Two of them resigned from Temer’s cabinet during the first weeks of his government. A third minister also quit after a recording of him criticizing the investigation was leaked to the media. (Writing by Alonso Soto; Editing by Daniel Flynn and Bernadette Baum)