SÃO PAULO--Brazil's federal police arrested João Vaccari Neto,
the treasurer of Brazil's ruling Workers' Party, or PT, as part of
an investigation of alleged corruption involving contracts between
state-run oil firm Petroleo Brasileiro SA and construction
firms.
Mr. Vaccari is accused of receiving "irregular donations" from
companies for the party, according to a federal police spokesman.
The spokesman didn't elaborate on the allegation and said more
details would be given at a news conference later Wednesday.
A Workers' Party spokeswoman wasn't immediately available for
comment.
Earlier this month, Mr. Vaccari testified before a congressional
committee investigating allegations of kickbacks and bribery at
Petrobras and said donations to his party were all legal and
approved by the country's electoral court.
The donations to PT were similar to those made by the companies
under investigation to many other political parties, Mr. Vaccari
told the committee. Brazilian police and prosecutors allege
Petrobras executives conspired with many of the company's suppliers
to inflate the value of contracts.
The extra money was then skimmed and distributed among the
Petrobras executives and several political parties, according to
investigators. Executives of construction companies have been
arrested during the investigation, and earlier this year, Brazil's
Federal Supreme Court approved investigations of dozens of
politicians.
Mr. Vaccari denied in his testimony ever discussing donations or
the PT's finances with former Petrobras executive Pedro Barusco.
Mr. Barusco has turned state's evidence and admitted to
participating in the scheme. Mr. Barusco told the committee in
testimony in March that he had discussed bribes with Mr.
Vaccari.
Write to Rogerio Jelmayer at rogerio.jelmayer@wsj.com and
Luciana Magalhaes at Luciana.Magalhaes@dowjones.com
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