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Brazil's governing party linked to bribery scandal

The businessman accused of bankrolling a bribes-for-votes scandal in Brazil's Congress provided the governing Workers Party with financial support, Brazil's leading news magazine reported.

The magazine, Veja, said yesterday that advertising executive Marcos Valerio co-signed a US$1 million loan obtained by the party from a bank in 2003, and that last year he made a payment of US$150,000 to the party. Veja said it had access to the loan documents because they were registered in Brazil's central bank.

The report could further tarnish the image of the Workers Party, which has long been known as a bastion of political ethics.

Valerio last week had told federal police that he had no connection with the Workers Party, and that he was not involved with the corruption scandal.

Party officials had also maintained that the party had no relationship with Valerio.

Workers Party Leader Jose Genoino told the magazine that he did not know Valerio had helped the party obtain the loan, but documents presented by Veja showed that Genoino and party treasurer Delubio Soares also co-signed and were joint debtors of the 2003 transaction.

But after Veja was published, Genoino backtracked and confirmed to other local media that Valerio was a co-signer in the Workers Party loan. In a statement late Saturday, Soares also confirmed the information.

Valerio could not be immediately reached for comment.

The corruption scandal broke three weeks ago when Rep. Roberto Jefferson -- then the leader of the allied Brazilian Labor Party -- claimed the Workers Party paid legislators monthly "allowances" of more than US$12,000 to keep intact the government's fragile governing coalition.

Faced with the new allegations, President Luiz Inacio Lula da Silva said Saturday that his administration will continue to do whatever is necessary to fight corruption.

"We will be implacable against opponents and allies who think they can take advantage of public money to become rich," Silva said in a speech at an international forum for leftist parties in Sao Paulo.

Last Thursday, Silva announced a series of measures to fight corruption within the government, including one that makes it a felony punishable by eight years in prison for a government worker to accept bribes.
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