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Brazilian Cabinet chief resigns amid ethics scandal

By the CNN Wire Staff
A newspaper inviestigation found Antonio Palocci's wealth grew 20 times in a period of four years while he was a lawmaker.
A newspaper inviestigation found Antonio Palocci's wealth grew 20 times in a period of four years while he was a lawmaker.
STORY HIGHLIGHTS
  • Antonio Palocci was under scrutiny for a sudden growth in personal wealth
  • The attorney general decided to close the case
  • It is the second time Palocci had to resign from a government post
RELATED TOPICS
  • Brazil
  • Dilma Rousseff

(CNN) -- Caught up in questions raised by a newspaper investigation into the sudden swelling of his wealth, Brazil's Cabinet chief resigned Tuesday, a hit against President Dilma Rousseff.

Antonio Palocci, a Worker's Party stalwart, served as finance minister for President Luiz Inacio Lula da Silva before becoming Rousseff's right-hand man as chief of staff.

In all, he was chief of staff to the president for only 23 days.

Palocci had been under fire since an investigation by the Folha de Sao Paulo newspaper found that his wealth grew 20 times during a period of four years while he was a lawmaker. As the scandal unfolded, several lawmakers asked for a formal investigation, but according to Palocci's resignation letter, the attorney general decided to close the case.

The closing of the case "confirms the legality and certitude of his professional activities in the recent period and the absence of any foundation, however minimal, on the allegations made about his conduct," according to a statement by his office.

It is a blow to the Rousseff administration, which gave Palocci the high-profile post even though he had once before had to resign from a government post under a cloud of suspicion for ethics violations.

In 2006, he stepped down as finance minister after allegations that he participated in a government scheme to bribe lawmakers to vote for certain ruling party projects. He was absolved of any wrongdoing and returned to politics.

Palocci coordinated Rousseff's election campaign, and with her victory became a key part of her transition team, the state-run Agencia Brasil news agency reported.

On Wednesday, Rousseff announced that she was naming Sen. Gleisi Hoffmann to replace Palocci as Cabinet chief.