Brazil Senate chief absolved of graft charges

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BRASILIA, Sep 13 (Reuters) Brazil's Senate chief narrowly escaped impeachment over corruption accusations but faces two other counts of unethical behavior that could unseat him and deepen the latest scandal to haunt President Luiz Inacio Lula da Silva's coalition.

Forty of the 81 senators voted to absolve Renan Calheiros of accusations yesterday that he had personal expenses paid by a construction firm in exchange for political favors. Thirty-five senators voted to oust him and 6 abstained.

Calheiros, a close ally of Lula, is one of Brazil's most influential politicians. His centrist Brazilian Democratic Movement Party, or PMDB, is the largest in Congress and ensures the 11-party governing coalition a majority.

Still, the narrow vote raised doubts over how much longer Calheiros could remain as the Senate's president. He faces two separate accusations of influence trafficking and fraud in the Senate ethics committee that could force him from office.

''Calheiros's situation is not sustainable. He'll temporarily step down, resign or be ousted,'' said Carlos Lopes, a political analyst in Brasilia.

Several important senators said the chamber would be stuck for months to come deciding its leader's fate.

''The institutional suffering goes on. That's not good for Brazil. We'll live this ordeal for weeks or months - that was the Senate's decision today,'' said the chamber's deputy leader, Tiao Viana, of the ruling Workers' Party.

Added Sen. Cristovam Buarque: ''Brazil won't have a Senate for the next few months. There's no mood for voting.'' Lula needs Congress to approve a series of economic measures in coming weeks, including the renewal of a financial transaction tax that is crucial for government finances.

The opposition, disappointed with the vote, which it says had been orchestrated by the ruling alliance, promised to toughen its stance on the government's CPMF tax proposal.

''We have to fight the CPMF, we'll radicalize (the debate) because this promiscuity of the allied base cannot continue,'' said Sen. Tasso Jereisatti, president of the opposition Brazilian Social Democracy Party.

Calheiros has in recent months become a symbol of the often murky wheeling and dealing in Brazilian politics.

Several lower house deputies seeking entry to the secret, closed-door ballot vote on Wednesday punched and pushed a security guard and scuffled with the Senate's vice-president.

The incident, shown on national television, is likely to further taint Congress's already poor public image. Less than 1 percent of Brazilians trust Congress, opinion polls show.

Several senators called for tougher ethical standards and more transparency, including the end to secret ballot votes.

Sen. Jarbas Vasconcellos, also of the PMDB, said congressional leaders facing accusations before the ethics committee should step down during investigations.

Lula has for the past three years been dogged by a series of corruption scandals involving prominent allies.

His energy minister resigned in May over accusations he took a kickback for a government contract and 40 former government allies are on trial, accused of running an illicit fund-raising scheme to finance election campaigns and bribe legislators.

Reuters SZ VP0616

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