Witness Repeats Allegations Against Politicians in Petrobras Inquiry

Witness Repeats Allegations Against Politicians in Petrobras Inquiry

Rousseff, Lula da Silva named in connection with alleged corruption at Petrobras

Alberto Youssef, a witness in Brazil’s investigation into alleged corruption at state-owned oil company Petrobras, is escorted by federal policemen before a hearing at the federal court in Curitiba in February. PHOTO: REUTERS

By

LUCIANA MAGALHAES And WILL CONNORS/WSJ

May 11, 2015 12:33 p.m. ET

CURITIBA, Brazil—A convicted money launderer at the heart of an investigation into an alleged corruption scheme at Brazil’s state-run oil company Petroleo Brasileiro SA reiterated on Monday allegations that top government officials, including PresidentDilma Rousseff and former President Luiz Inácio Lula da Silva, knew about the alleged scheme.

Alberto Youssef, a currency dealer who was convicted of money laundering and sentenced last month to three years in jail, was speaking in front of a congressional commission investigating the alleged corruption at Petrobras. Mr. Youssef had previously made the allegations to investigators as part of a plea deal for a lesser sentence.

When asked by lawmakers Monday if Ms. Rousseff and Mr. Lula da Silva, along with other top government officials, knew of the alleged scheme, Mr. Youssef said, “It is my understanding that [they] knew everything.”

A spokeswoman for Ms. Rousseff didn’t immediately respond to a request for comment. A spokesman for Mr. Lula da Silva declined to comment. Ms. Rousseff and Mr. Lula da Silva have in the past repeatedly denied any wrongdoing or knowledge of the scheme.

Lawmakers from Brasília are in the southern city of Curitiba, where the investigation into the alleged corruption is based, and where witnesses now in custody are set to testify. Still to appear before the commission is former Petrobras director Nestor Cerveró, who was arrested and charged with money laundering and bribery earlier this year. Mr. Cerveró has denied the charges.

Mr. Youssef is a central figure in the corruption scandal, which led Petrobras to write off more than $2 billion due to alleged bribe payments. Petrobras considers itself a victim of the scheme and says it is cooperating with investigators.

Prosecutors in charge of the case, known in Brazil as Operation Car Wash, have said they first uncovered irregularities while investigating Mr. Youssef’s money-laundering activities and noticed he had given a luxury vehicle to a Petrobras executive.

Write to Luciana Magalhaes at Luciana.Magalhaes@dowjones.com and Will Connors atwilliam.connors@wsj.com