Little Christmas joy for Brazil's jailed high and mighty

By Caroline Stauffer and Anthony Boadle

SAO PAULO/BRASILIA (Reuters) - The former chief executive officer of Latin America's largest engineering group will be allowed panettone in his jail cell this Christmas. He may even get turkey, as long as it is boneless.

For the first sitting Brazilian senator to be jailed in modern times, the season will be equally gloomy. He will spend Christmas Day in a room with a chair and a bed, and no family visit.

Marcelo Odebrecht, ex-CEO of the multinational construction company bearing his billionaire family's name, and Senator Delcídio do Amaral are among a handful of prominent and powerful Brazilians facing Christmas in jail this year, awaiting judgement in a massive corruption investigation.

The scandal centred around state-controlled oil giant Petroleo Brasileiro SA, along with impeachment proceedings against President Dilma Rousseff over an unrelated issue and a deep economic recession, have combined to rock the Brazilian establishment.

Federal judge Sergio Moro, a white-collar crime specialist, and a team of young prosecutors have dismantled a massive price-fixing, bribery and political kickbacks scheme that engulfed Petrobras.

The sight of wealthy executives led away in handcuffs has stunned much of Brazil, a country where the gap between rich and poor remains large, but some have questioned the value of lengthy pre-trial detentions.

Unless Brazil's Supreme Court has a change of heart and accepts a request for his release, Odebrecht, 47, will spend the holiday at the state-run Pinhal medical complex in the southern city of Curitiba, where he shares a cell with two others.

Family members may bring a special lunch including rice or pasta, boneless meat and panettone bread for Christmas, but no presents, a spokeswoman said. The prison is holding normal Friday - Sunday visiting hours this week.

Odebrecht, who receives special rations for hypoglycemia, is likely to spend some of Christmas Day doing push-ups, part of an intensified fitness regimen he has followed since being jailed, according to a source close to his family.

The former executive was arrested on June 19 and charged with corruption and money laundering a month later, charges he denies.

Odebrecht's lawyers were not available for an interview, but his company said in an e-mailed statement it was confident the Supreme Court would reverse the former CEO's "illegal and abusive" detention.

CHIPPING AWAY AT IMPUNITY

The corruption scandal has tested the judicial system of a country that transitioned from military dictatorship to democracy only 30 years ago. Judge Moro has won fans among many Brazilians as he has chipped away at the impunity traditionally enjoyed by the country's rich and powerful.

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He has kept executives in jail on the grounds they could continue to commit crimes if free, and are a risk to public order. The Supreme Court, however, converted at least 10 preventive detentions of engineering executives that Moro had ordered into house arrest this year.

"Brazil is only going to improve when we put away all these corrupt politicians and businessmen and start over from scratch," said Leda Marin at a recent protest calling for Rousseff's impeachment, where many held up banners in support of Moro.

But defence lawyers and some independent observers say the case has been marred by excesses, like keeping defendants in jail while the courts are on recess.

Judicial overreach was among Odebrecht's arguments for release after six months of pre-trial detention, but Brazil's second-highest court voted against his lawyer's appeal last week.

Leonardo Sica, who is the president of the Sao Paulo bar association and who is defending a client in the case who is not in jail, said the public has put unrealistic expectations on the operation to end corruption, and that doing this will also require new laws and changes in society.

"With or without money, no one can be jailed just to serve as an example to others," said Sica.

'NO SPECIAL PRIVILEGES'

Another of those accused in the case, Senator Amaral, would usually spend the holiday at his palm tree-fringed mansion in the soybean growing heartland of Mato Grosso do Sul.

He was moved last week from a 3 by 3-meter (10 by 10-foot) federal police cell where he slept on a mattress to an improvised prison in Brasilia, where he has a bed, a chair and table and a toilet and is allowed visits twice a week.

"He is a prisoner. He has no special privileges. His family can bring him food but he cannot have a Christmas meal with them," said Captain Denise Campos, of the Military Police that is holding the senator at one of their bases.

"He is depressed, but more relaxed since he was moved," said Amaral's spokesman, Eduardo Marzagao. "He had to knock on the cell door to go to the toilet," said Marzagao. "It is very hard for a man who was so important."

Amaral was arrested on Nov. 25 and charged with obstructing the Petrobras investigation. The evidence against the 60-year-old senator was a tape of him arranging bribes to buy the silence of a defendant before he entered a plea bargain. Amaral has denied obstruction but acknowledged his voice is on the recording. His lawyers say his detention was unwarranted.

All in all, a dozen people charged in the bribery scheme, including two other Odebrecht executives, former President Luiz Inacio Lula da Silva's Chief of Staff Jose Dirceu, and the former treasurer of the ruling workers' party, João Vaccari, are expected to spend the holidays in the Curitiba complex. There they watch television and follow a strict schedule of visits to a patio to take in sunlight.

At the federal police headquarters in Curitiba, unlike the medical complex where Odebrecht is held, seven prisoners in the case will receive no special rations or see family on the holiday, as visitors are allowed only on Wednesdays.

"Jail is jail," a spokesman said.

Not every high-profile suspect is behind bars. Andre Esteves, ex-CEO of Latin America's largest independent investment bank Grupo BTG (L:BTG) Pactual SA, whose jailing critics have cited as a particularly egregious instance of arrest without adequate proof, won his release last week.