Brazil's ex-president Temer arrested, accused of heading 'criminal organization'

Brazil's former president Michel Temer was arrested on Thursday in "Operation Radioactivity," a probe of alleged graft in the construction of a nuclear power plant, threatening to delay debate over the government's ambitious fiscal reforms.

Temer was president from 2016 to 2018, taking office after the impeachment of Dilma Rousseff, who he served under as vice president for six years. His lawyer confirmed he was arrested in Sao Paulo, and his legal team has lodged an appeal for Temer to be freed.

Prosecutors alleged that Temer was the leader of a "criminal organization" that took in 1.8 billion reais (475 million U.S. dollars) in bribes or pending future kickbacks as part of numerous schemes, including one related to the Angra nuclear power plant complex on the Rio de Janeiro coast and other state firms. 

A convoy of police cars, transporting Brazil's former president Michel Temer drives at International Airport Galeao in Rio de Janeiro, Brazil, March 21, 2019. /VCG Photo

The former president's Brazil Democratic Movement party long held sway over key appointments in Brazil's largely state-run energy sector, including nuclear power plants.

Brazil's currency and the Bovespa stock index both slipped around one percent, as the arrest grabbed the attention of Congress just as it was taking up a bill to save some one trillion reais in social security spending over a decade.

"This could slow down the pension reform process, which is already disappointing," said Danilo Gennari, partner at Brasilia-based political consultancy DRG. "Temer's arrest will not help the climate in Congress."

Federal police also arrested Temer's former minister and confidant Wellington Moreira Franco, who is married to the mother-in-law of Rodrigo Maia, the speaker of the lower house of Congress and a leading proponent of pension reform.

Temer and Moreira Franco have repeatedly denied previous accusations of wrongdoing. Maia was not immediately available for comment.

Wellington Moreira Franco (R) is Michel Temer (L)'s former minister and confidant. /VCG Photo

Asked about the arrest during a trip to Chile, President Jair Bolsonaro said "everyone must respond for their actions" and that Temer's fate was the result of traditional corrupt political practices that he has vowed to end.

Brazil's sweeping "Car Wash" probe has uncovered what U.S. prosecutors called the world's largest graft scheme, starting with political bribery involving oil company Petroleo Brasileiro SA and spreading to other sectors and public works.

Over 150 powerful politicians and businessmen have been convicted in relation to the investigation since 2014, which has reshaped the country's political and business landscapes.

Temer is the second former president to be arrested in the anti-corruption push. Former president Luiz Inacio Lula da Silva is in jail serving over 12 years for a corruption conviction.

(REUTERS)