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Brazilian lawmakers urge indictments in Petrobras scandal

A view is seen of the Petrobras headquarter in Rio de Janeiro December 16, 2014. REUTERS/Sergio Moraes

By Maria Carolina Marcello

BRASILIA (Reuters) - A congressional committee investigating a mushrooming corruption scandal at Brazil's state-run oil company Petroleo Brasileiro SA (PETR4.SA) recommended on Thursday that prosecutors bring charges against 52 people for alleged money laundering and racketeering.

The committee made its non-binding recommendation in a report approved in a 19-12 vote. It now goes before the two houses of Congress for debate and a final vote.

The call for indictments was included at the last moment and comes after federal prosecutors charged 39 people over the past week in an estimated $3.76 billion (10-billion-real) bribery scheme dogging the government of President Dilma Rousseff.

Those charged, many of whom appear on the list of people targeted by the congressional panel, include two former Petrobras division heads and more than 20 executives of Brazil's biggest construction and engineering companies.

State-level prosecutors in Rio de Janeiro are seeking further indictments, including that of former Petrobras Chief Executive Officer Jose Sergio Gabrielli.

Rousseff's government fought to limit the scope of the congressional investigation. Using its majority on the committee it worked to prevent testimony from political allies and the president. Rousseff was chairwoman of Petrobras from 2003 to 2010 when much of the alleged graft took place.

Rousseff has said she did nothing wrong and has promised to fully investigate the alleged corruption at Petrobras.

The committee first probed alleged bribes and overpayments related to Petrobras' $1.2 billion purchase of a refinery in Pasadena, Texas in 2006. Its scope broadened as police and prosecutors produced new evidence of wrongdoing at other Petrobras projects, including the nearly $20 billion Abreu e Lima plant in Brazil, one of the most-expensive refineries ever built.

According to prosecutors, Petrobras officials conspired with construction and engineering firms to inflate the value of contracts and then kicked-back a percentage of the profits to Petrobras executives and politicians as bribes and campaign contributions.

The congressional report does not recommend the filing of charges against any politicians. But a leading witness cited in the report, former Petrobras refining chief Paulo Roberto Costa, has testified that the scheme involved dozens of members of Congress.

The congressional report does not call for charges to be filed against any current Petrobras executives.

(Writing by Jeb Blount and Anthony Boadle; Editing by W Simon and Tom Brown)