By Samantha Pearson and Luciana Magalhaes 

SÃO PAULO -- Brazil's Supreme Court has authorized investigations of dozens of top politicians and government officials for alleged corruption related to the sprawling Operation Car Wash probe, delivering a major blow to President Michel Temer as he struggles to get economic reforms approved.

Justice Edson Fachin, who is overseeing cases in Brazil's high court related to the Car Wash probe, has given permission for prosecutors to open investigations of at least eight cabinet ministers, the leaders of both houses of Congress, and more than 20 senators and federal deputies, according to a document from the court released on Tuesday.

The investigation involves a bid-rigging and bribery scheme at state-controlled oil company Petróleo Brasileiro SA, or Petrobras, and has resulted in numerous convictions of business and political leaders.

In Brazil, the Supreme Court has to approve investigations of sitting politicians and cabinet members.

The announcement comes as the Temer administration is trying to guide a controversial reform of the country's insolvent pension system through Congress. The reform is seen as necessary to help reduce the government's yawning budget deficit and restore confidence in the nation's ailing economy.

"This is hitting at the heart of government especially as these are important ministers for Temer," said Rafael Cortez, a political scientist at São Paulo-based consultancy Tendências. "This will create even more turbulence and increase the urgency to pass economic reforms."

Among the cabinet ministers that face investigation are Chief of Staff Eliseu Padilha and Secretary-General of the Presidency Wellington Moreira Franco, both of whom are key to the administration's relations with Congress. Mr. Padilha declined to comment, and Mr. Moreira Franco wasn't immediately available to comment.

Eunicio Oliveira, head of Brazil's Senate, said he will defend himself against any accusations. Rodrigo Maia, who leads Brazil's lower house of Congress, couldn't immediately be reached for comment.

Brazil's economy contracted in 2015 and 2016 as the country suffered through its worst recession in recorded history, and this year gross domestic product is forecast to expand less than 1%.

Jeffrey T. Lewis contributed to this article.

Write to Samantha Pearson at samantha.pearson@wsj.com and Luciana Magalhaes at Luciana.Magalhaes@wsj.com

 

(END) Dow Jones Newswires

April 11, 2017 20:40 ET (00:40 GMT)

Copyright (c) 2017 Dow Jones & Company, Inc.
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