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Brazil's Geithner

Tax evasion, insider transactions, Oil, Senate committees, potential corruption. Could be a prime-time dramatization of the Tim Geithner story (true, we haven't found the Turbo Tax angle yet, but give the story some time to germinate), or just another bit of BRIC background noise.

Petroleo Brasileiro SA, struggling to meet output targets and finance a $174 billion spending plan, faces a new challenge today as Brazil's Senate probes claims it evaded taxes and funneled cash to government allies.

Shocking. Of course, in jurisdictions with large extraction economies, political power and scandal, natural resources and opposition parties all roll into one big slime pool. Of course, that seems to be the case in jurisdictions with large financial services economies as well.

The investigation, prompted by opponents of Brazilian President Luiz Inacio Lula da Silva, focuses on allegations Rio de Janeiro-based Petrobras evaded 4.4 billion reais ($2.4 billion) of taxes, overpaid for goods and may have favored the president's supporters when it made charitable donations. Chief Executive Officer Jose Sergio Gabrielli denies the claims.

When the largest oil company in a commodity driven economy finds itself in the crosshairs of the Brazilian President, it doesn't take much to wonder after the BRIC perma-bulls.
Petrobras Probe Starts as Gabrielli Faces 'Crisis' [Bloomberg]