MercoPress. South Atlantic News Agency

Brazilian corruption: “all party leaders involved”

Brazilian ruling Workers Party, PT, former secretary general Silvio Pereira confessed that all top party leaders were well aware of the illegal financial scheme to pay for campaigns and ensure political support in Congress which has turned into a gigantic corruption scandal threatening President Lula da Silva's political future.

In an interview with Folha de Sao Paulo, Mr. Pereira, a long-time colleague of President Lula da Silva, confirmed the existence of a parallel accounting scheme to hide illegal campaign financing from electoral and fiscal authorities.

"Nobody can be so hypocritical as to say they didn't know about the parallel funding. Which member of the PT leadership didn't know that?" said the former secretary of the socialist Workers Party founded by Mr. Lula then a union leader in 1980.

Pereira insisted that all 21 members of the party's national leadership, including PT former president Jose Genoino, "knew what was going on".

However Mr. Pereira excluded President Lula from the claim arguing "he was never involved in the party's internal decisions", as well as all powerful former Cabinet chief Jose Dirceu who supposedly distanced himself from the PT leadership when the scandal became public eight months ago.

The corruption scandal involving PT leadership has become more serious and far reaching than that of former president Fernando Collor forced to resign in 1992.

Mr. Dirceu, President Lula's closest advisor and who managed the PT with an iron fist for years has lost favour with the administration and together with another 17 members of Congress are under investigation and could be ousted from office.

PT slush funds were used not only for campaign financing but for bribing other Congress members and parties to support the administration's legislative agenda. Some payments were done regularly in Congress others in off shore accounts.

PT alleges the undeclared funds came from bank loans, totalling 25 million US dollars, however "contributions" from government owned companies and private corporations needing favours were also skimmed into the slush fund according to several investigations in Congress.

Mr. Pereira alleges that the PT's "generosity" even extended to Senator Delcidio Amaral, who heads one of the legislative committees investigating the scandal. He also mentioned former Sao Paulo Mayor Marta Suplicy, one of the PT's key figures.

"Delubio Soares, (PT's former treasurer), was constantly besieged by all the party's regional leaders asking for money to finance their election campaigns. The party heads of the 27 states came to Delubio seeking for funds" added Mr. Pereira.