Brazil probe pits investigators against long-protected elite

By Caroline Stauffer CURITIBA, Brazil (Reuters) - In a nation where the elite have enjoyed relative impunity, a new generation of police and prosecutors in Brazil are bent on using the country's largest-ever corruption investigation to send the message that no one is above the law. They have displayed in a local museum works of art seized in arrests in connection with alleged bribery at state-run oil firm Petrobras. They have also paraded lobbyists and chief executives in handcuffs before TV cameras. And they gave the moniker Operation 'Erga Omnes,' Latin for 'For everyone' to a raid that jailed one of the country's most powerful corporate scions, CEO Marcelo Odebrecht. Earlier this week they publicized a hand-written note Odebrecht wrote from jail. Police said the arrests have come as a "shock" to the wealthy and powerful suspects. "These people thought the police, and justice, would never reach them," Federal Police agent Erika Marena told Reuters this week in her office in Curitiba, the epicenter of the Petrobras investigation. Marena said it has been particularly surprising to see some detainees struggle with basic rituals like shaving or laundry, presumably because they had "a group of people who took care of everything for them." "There are people who do not know how to wash their own clothes, things that are basic for anyone but not for someone who lived in this scale of luxury," she said. While Marena doesn't name names, Curitiba prisons now house more than a dozen lobbyists, political party officials and construction executives. For the last week, they have included Odebrecht, who runs Latin America's largest engineering conglomerate. Odebrecht lawyers say the arrest was illegal and the intercepted note was misinterpreted. Marena is one of around 30 law enforcement agents helping a group of prosecutors - popularly known as "The Untouchables" - mount a massive case that aims to stamp out impunity and end what they call a "culture of corruption" in Brazil. Knowing that the probe has wide support among Brazilians, investigators openly share details of arrests and have declared the press to be their ally. The landmark probe "is changing the idea of impunity" said Rodrigo Prando, a sociologist at Mackenzie University in Sao Paulo. "The United States is used to celebrities being arrested; Brazil has never seen this," he said. JUSTICE CELEBRITIES The wealth and status of the executives contrast with the austere style of investigators who have spent long hours in cramped offices in the 16 months since an investigation into local currency changers led them to a massive kickback scheme. They accuse engineering executives of forming a cartel to fix prices and inflate the value of service contracts with Petrobras to enrich themselves and politicians, nearly all from or aligned with President Dilma Rousseff's Workers' Party. Though they have become celebrities with frequent television appearances in Brazil, the prosecutors laugh when asked about fears for their safety. The federal judge overseeing the case, Sergio Moro, even rides his bicycle to work on occasion. While the court of public opinion may be with the prosecutors, critics accuse them of overreaching with some tactics, including the release of the Odebrecht note. They were dealt a setback last month when Brazil's Supreme Court ordered the release into house arrest of 10 executives who had been in pre-trial detention for five months. Neither Rousseff nor her predecessor Luiz Inácio Lula da Silva are being investigated and Rousseff says she had no knowledge of the scheme when she presided over Petrobras' board from 2003 until 2010, when much of the alleged graft took place. Still, a survey by Datafolha in April showed 57 percent of Brazilians believe she knew about the corruption and 63 percent supported opening impeachment proceedings. Her approval rating has plummeted because of the investigation. Meanwhile, at the federal police headquarters and courthouse in Curitiba, Brazilians have adorned colorful ribbons on the trees and fences in support of the investigation. And while Judge Moro tries to avoid the spotlight, he is greeted with cheers and flashing cameras wherever he travels. (Editing by Mary Milliken and Christian Plumb)