Brazil's Supreme Court approves probe into Temer

Brazil's Supreme Court approves probe into Temer

O Globo reported that Mr. Batista told President Temer about regular payments to Mr. Cunha, and the president responded that Mr. Batista should continue what he was doing.

If Temer's presidency is over, the best option for markets would be having lawmakers quickly appoint a new leader.

Brazil's real, stocks and bonds sank as a fresh political crisis ensnared President Michel Temer and threatened to derail a reform agenda that had helped restore confidence in the embattled South American nation.

Temer's office has denied the allegations that he endorsed paying off a witness.

Mr. Cunha was convicted earlier this year of money laundering and corruption as part of the Operation Car Wash anticorruption probe.

Brazil's Supreme Court ruled that Neves be suspended from the Senate due to the allegations, the source said. "I know what I have done", he said, according to a BBC translation.

Brazilians watched in shock as federal police carried out search and arrest warrants throughout the capital, Brasilia, in dramatic scenes reminiscent of the impeachment process a year ago that brought Temer to power.

Joesely Batista is said to have recorded senator and former presidential candidate Aecio Neves of the centre-right Brazilian Social Democratic party requesting two million reais in bribes.

JBS, which grew rapidly under 13 years of leftist Workers Party rule due largely to low-priced loans from Brazil's national development bank, said on Thursday that it had no comment on the situation.

Former vice president Michel Temer assumed the presidency following Dilma Rousseff's removal from office on September 1, 2017.

Globo reported late on Wednesday that Mr Neves had been recorded asking JBS meat-packing company executive Joesley Batista for 700,000 USA dollars (£540,000) to pay for his "Car Wash" defence. Local TV images showed a crowd of protesters gathered in Sao Paulo, Brazil's largest city.

But with lawmakers under the cloud of corruption, there are widespread calls in Brazil that the constitution be changed to allow for direct elections now. The executives' evidence forms part of a plea-bargain deal, according to O Globo newspaper, in which information is offered in exchange for reduced sentences. "There are just too many people against him now".

Temer was Rousseff's former vice president and has been serving as interim President since her suspension in May 2016.

Brazil's Superior Electoral Court will start the trial process on June 6 that could lead to the Temer's impeachment - if he's proven guilty. Brazilian media reported that he could make a public statement.

Rousseff, from the leftist Workers' Party, accused Temer and Cunha, from the center-right PMDB party, of mounting a coup.

According to the report, which could not be immediately verified, an executive from the meatpacking giant JBS, Joesley Batista, met with Temer on March 7.

A key government ally, Neves lost the 2014 presidential election against Rousseff.

Associated Press writer Peter Prengaman reported this story in Rio de Janeiro and AP writers Mauricio Savarese and Sarah DiLorenzo reported from Sao Paulo.

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