Brazil slams Panama for not helping in Petrobras graft probe

BRASILIA (Reuters) - Brazil's top prosecutor's office complained on Thursday that Panama had failed to deliver banking information requested over a year ago in the massive corruption investigation surrounding state-controlled oil company Petróleo Brasileiro SA. Brazilian prosecutors suspect financial institutions were used to move offshore millions of dollars in graft money from the scheme at the company known as Petrobras, and pay bribes to Brazilian politicians. They said lack of cooperation from Panama had frustrated their investigations "Brazilian authorities reiterate the need for a rapid reply to the requests made to Panama," the office of Brazil's prosecutor-general said in a statement, adding Panama had so far failed to comply with international conventions on penal cooperation. The statement was issued two days after a meeting with Panamanian prosecutors who showed up in Brasilia for an unscheduled meeting where Brazil's requests for bank documents relating to the Petrobras probe were discussed. Prosecutors have long criticized Panama for not cooperating with efforts to investigate corruption practiced by Brazilian companies in that nation - and in particular the projects that the country's largest engineering group Odebrecht has worked on there. "Panama is our biggest problem, to tell you the truth," Carlos Lima, a lead prosecutor on the Petrobras investigation, told Reuters earlier this year. "There have always been obstacles to working with them." Panama's prosecutor general's office said the Brazilians cancelled a meeting with its prosecutors on Thursday. It said in a statement the Panamanian prosecutors travelled to Brazil because their Brazilian counterparts had refused to go to Panama to explain what they needed. The Brazilian statement said prosecutors had visited Panama twice and provided the details Panama asked for. In July, Brazilian police launched an investigation of Panama's FPB Bank, which allegedly worked with the "Panama Papers" law firm to transfer abroad money that came in part from a multibillion-dollar price-fixing and bribery scheme at Petroleo Brasileiro SA. Police said FPB Bank was under investigation for "financial crimes, laundering of assets and transnational criminal organisation" for offering private banking services without the authorization of Brazil's central bank. Offshore companies registered by the Panama-based law firm Mossack Fonseca, the subject of a huge data leak earlier this year dubbed the Panama Papers, helped FPB Bank get clients' money out of Brazil illegally, police said at the time. FPB Bank said in July it had no operations in Brazil and that accusations it was involved in the corruption scheme were "erroneous." (Reporting by Anthony Boadle and Brad Brooks in Brazil, additional reporting by Elida Moreno in Panama City; Editing by Peter Cooney)