February 5, 2015 / 7:08 PM / 3 years ago

UPDATE 1-Brazil police question ruling party treasurer in Petrobras probe

(Adds Workers' Party statement, Vaccari statement, background)

By Caroline Stauffer

SAO PAULO, Feb 5 (Reuters) - Brazilian federal police said on Thursday they had started questioning João Vaccari Neto, the treasurer of the country's ruling Workers' Party, as a corruption probe focused on state-run oil company Petrobras widened to include political figures.

"We want to know about donations that he solicited, legal or illegal, from people who had contracts with Petrobras," prosecutor Carlos Fernando dos Santos Lima said at a press conference in Curitiba, where the probe started.

Police and prosecutors have accused former executives of Petroleo Brasileiro SA (Petrobras) of conspiring with construction and engineering companies to funnel kickbacks to Rousseff's Workers' Party and its allies.

Vaccari is the most senior politician to be officially questioned in the case, which led Petrobras' chief executive officer and senior managers to resign this week and caused a political crisis for leftist President Dilma Rousseff.

The Workers' Party said in a statement on Thursday that the accusations were unfounded "lies" and that it had only received legal campaign donations. Vaccari has not been charged with any crime.

Soon after, Vaccari issued a statement in which he reiterated that the Workers' Party only receives legal contributions and that he would cooperate with investigators.

As treasurer for the party, Vaccari was responsible for soliciting campaign donations for Rousseff during last year's presidential election.

In plea bargain testimony late last year, reviewed by Reuters on Thursday, former Petrobras executive Pedro Barusco accused Vaccari of diverting up to $200 million to Workers' Party coffers between 2003 and 2013.

Barusco cooperated with investigators to avoid being arrested, and prosecutors said at Thursday's press conference that they have not been able to verify his accusation.

Federal police said in a statement on Thursday that four additional arrest warrants had been served and 18 people had been called to testify.

Lima, the prosecutor, said the latest facet of the investigation centered on possible corruption at Petrobras subsidiary BR Distribuidora, which operates 7,000 service stations in Brazil and imports and exports oil byproducts. Lima said prosecutors were looking into whether there was corruption at the subsidiary.

Rousseff has denied knowledge of any kickback scheme and urged a thorough investigation.

The probe has become a major headache for her because she chaired the board of Petrobras between 2003 and 2010 when much of the graft is alleged to have taken place. (Additional reporting by Walter Brandimarte and Gustavo Bonato; Editing by Brian Winter, Toni Reinhold)

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