Peru prosecutors seek arrest of ex-president Toledo in graft inquiry

LIMA (Reuters) - Prosecutors in Peru asked a judge to order the arrest of former President Alejandro Toledo on Tuesday for suspected involvement in a bribery scheme linked to scandal-plagued Brazilian construction conglomerate Odebrecht SA.

FILE PHOTO: Former president Alejandro Toledo speaks to the media in Lima, January 27, 2011. REUTERS/Mariana Bazo/File Photo

Authorities searched a house owned by Toledo in Lima on Saturday after finding $11 million in the bank account of one of his associates. Prosecutors believe the money was part of $20 million in bribes that Odebrecht has acknowledged paying to officials during Toldeo’s 2001-2006 government.

In their request on Tuesday, prosecutors asked Judge Richard Concepcion to jail Toledo for up to 18 months while they prepare criminal charges against him, the attorney general’s office said on Twitter.

Concepcion is expected to hand down a decision this week.

Toledo rose to power denouncing the rampant corruption in the government of his predecessor Alberto Fujimori, an authoritarian leader who is serving a 25-year prison sentence for graft and human rights abuses.

Toledo’s indigenous roots and rise from shoeshine boy to successful economist, inspired many poor Peruvians and helped catapult him to the presidency. But after leaving office, his image has been tarnished by a long-running investigation into potential money laundering linked to his family’s purchase of a luxury home and other properties in Lima.

In December, Odebrecht acknowledged in a settlement with prosecutors in the United States that it had distributed hundreds of millions of dollars in bribes to secure contracts across Latin America, including $29 million for unnamed officials in Peru from about 2005 to 2014.

Toledo’s whereabouts were not immediately clear on Tuesday and he did not respond to requests for comment. But he denied any wrongdoing in a telephone interview on Friday from Paris with local daily El Comercio.

The request for Toldeo’s arrest is part of the regional fallout from a far-reaching inquiry in neighboring Brazil that could raise questions about current President Pedro Pablo Kuczynski, who served as Toledo’s finance minister and prime minister a decade ago.

Kuczynski, a former investment banker, has denied any involvement in Odebrecht’s kickback schemes. But he is the target, along with Toledo, of a separate, preliminary investigation regarding a law they signed off on in 2006 that removed legal obstacles to highway contracts awarded to Odebrecht and other Brazilian companies.

The scandal also threatens to implicate former presidents Alan Garcia and Ollanta Humala. Garcia has denied any wrongdoing in recent weeks as authorities have arrested several accused of taking bribes from Odebrecht during his 2006-2011 government.

Odebrecht, once Latin America’s biggest construction company, and an affiliated company agreed to pay about $3.5 billion in fines for its role in the massive corruption scheme involving the state-run oil company in neighboring Brazil.

Reporting By Mitra Taj; Editing by Tom Brown