Brazil’s Mega-Scandal Hits Its Biggest Lender

Brazilians rarely do things small. They boast Latin America’s biggest economy but also own its worst recession, a seemingly bottomless corruption scandal and a government allegedly so practiced at disguising budget shortfalls that President Dilma Rousseff was ordered to step aside early Thursday morning. She’ll now face an impeachment trial in the Senate; few analysts expect she’ll be back.

But Brazil’s corruption sleuths never sleep.  So perhaps it’s no surprise that even as vice president Michel Temer prepares to take over, the so-called Car Wash probe into a rolling graft and kickback scheme — which already has tainted much of Brazil’s senior political establishment and pillaged the state oil giant Petrobras — now threatens to engulf the government’s most important financial institution, as well.

This week, federal investigators detained former finance minister Guido Mantega for questioning about alleged malfeasance at the state-owned National Social Development Bank, popularly known by its initials Bndes. The feds were looking into accusations by imprisoned construction mogul Marcelo Odebrecht that Mantega had pressured him and other contractors to make campaign donations to political allies in exchange for subsidized loans from the development bank.

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