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Brazil interim president denies graft allegations in Petrobras scandal

Brazil’s interim president Michele Temer (Image courtesy of TVNBR/Youtube)Brazil's interim president Michele Temer has denied allegations that he received campaign donations tied to the Petrobras corruption scandal.

In a plea deal seen by Reuters, former Petrobras transportation chief Sergio Machado alleges that Temer requested and received a legal campaign contribution from Queiroz Galvao, a Brazil-based engineering group.

However, Machado said that the donation funds came from kickbacks tied to Petrobras contracts.

Petrobras is the state-owned oil and gas giant that controls most of Brazil's energy segment.

Temer has denied the allegations. His office told Reuters he has always complied with campaign finance laws.

Temer became interim president last month after president Dilma Rousseff was suspended for allegedly violating budget laws.

In testimony seen by Reuters, Machado alleges that he and Temer met in 2012 to discuss a potential solicitation of illegal funds from companies that had contracts with Petrobras.

Machado also alleged that those funds were to be paid in the form of official donations.

Former Petrobras executive Paulo Roberto Costa alleged in September 2015 that some Petrobras executives skimmed as much as 3 percent off company contracts.

Costa also alleged the skimmed funds were used for illegal political campaign financing, including funding campaigns run by Machado.

Costa admitted in 2014 that he took a $636,000 bribe in connection with Petrobras' 2006 purchase of a Texas refinery.

Petrobras's third quarter 2014 results were delayed three times after PricewaterhouseCooper refused to sign off on accounts tied to Machado.

Brazil officials first launched their probe into alleged corruption related to Petrobras contracts in 2014.

The investigation, known as Operation Car Wash, has implicated several high-profile politicians, including former Brazilian president Luiz Inacio Lula da Silva who is being investigated for alleged influence peddling.

From the Petro Global News Wire Service © 2016 All Rights Reserved