Dilma's Honeymoon May End With Minister No. 8: The Ticker

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By Mayara Vilas Boas

(Corrects date in ninth paragraph.)

There's a saying in Brazil: “pega ladrao" -- or catch the thief. That's exactly what has been happening in President Dilma Rousseff’s first year in office. Last week, Carlos Lupi, the head of Brazil’s department of labor, became the seventh minister to leave office this year, and the sixth one to go because of corruption allegations.

So who's next? It may be Fernando Pimentel, the minister of development, trade and industry, whose consulting firm, P-21 Consultoria e Projetos Ltda., is getting caught up in an influence peddling scandal.

His case may be the first that shakes the public's faith in Rousseff's government.

The Brazilian newspaper O Globo reported Dec. 4 that suspicious bids, contracts, payments and compensation packages -- adding up to 2 million reais ($1.1 million) -- had been handled by the minister's firm between 2009, when Pimentel stepped down as mayor of the city of Belo Horizonte, and 2010, when he left the firm to lead the ministry.

When the information became public, the opposition Brazilian Social Democracy Party, or PSDB, pressed for a federal ethics investigation. It also asked the minister to testify in front of the Congress and Senate.

Pimentel argues that he wasn't in public office when he supplied the consulting services, and thus couldn't be accused of any wrongdoing. Still, his case reminds many Brazilians of Antonio Palocci, Rousseff's former chief of staff, who left office in June after similar allegations. Palocci's personal wealth increased about 20-fold after he joined the federal government.

A Bloomberg News survey in September showed that Rousseff's "anti-corruption" policy has helped raise the president's approval rating to 71 percent. Brazilians, far from blaming Rousseff for the resignations, cheered what they saw as a long-overdue crackdown on shady politicians.

But Pimentel's case is different. He has been a close friend of the president for more than 30 years, and he is the only minister accused of corruption this year who wasn't inherited from the government of Rousseff's predecessor, Luiz Inacio Lula da Silva. Pimentel was appointed by Dilma and is a member of the same political party.

Rousseff's reaction to the scandal so far has been ham-handed. She has suggested that she doesn't want Pimentel to be "exposed" or to testify before Congress, saying that doing so would give ammunition to her political opponents. She sent Pimentel to Argentina on Dec. 8 to discuss a trade agreement, leading some to suspect that she's shielding him from investigators. O Globo columnist Elio Gaspari wrote: "If doctor Dilma thinks she can keep Fernando Pimentel at the ministry of development, she might as well bring back Antonio Palocci, and apologize to him for her wrongdoing. Both made a fortune in consulting fees to entrepreneurs and companies."

Maybe the president has been given too much credit for pega ladrao -- and maybe her public honeymoon is coming to an end.

(Mayara Vilas Boas is on the staff of Bloomberg View.)


-0- Dec/12/2011 18:58 GMT