RIO DE JANEIRO - Brazilian President Michel Temer late Wednesday denied a report that he endorsed bribing a now jailed former congressman to keep him quiet, an allegation that could have widespread impact in a nation swamped by graft scandals and a populace furious about it.
The allegation made in Globo newspaper report represented a potentially significant blow for Temer, whose administration has lurched from one crisis to another since he took office just over a year ago.
In a statement, the president's office said Temer never solicited payments to keep former Speaker of the House Eduardo Cunha silent.
"He did not participate or authorize any attempt to keep Cunha from reaching a plea bargain with Justice (officials)," the statement said.
Cunha led the impeachment fight that removed Dilma Rousseff from the presidency last year and put Temer, then the vice-president, into power. Cunha was later imprisoned on a 15-year sentence for corruption.
The statement from Temer's office confirmed that in March the president did meet with Joseley Batista, chairman of the meat-packing company JBS. According to the Globo report, Batista secretly recorded the conversation with Temer and gave it to justice officials as part of plea bargain negotiations.
The report said that when Temer was told Cunha was being paid to keep silent, the president responded: "You have to keep that up, all right?"
Globo did not release the recording or say how it was obtained.
JBS representatives did not respond to an email sent by The Associated Press late Wednesday seeking comment.
Temer and Cunha are both members of the same party and were previously allies, but they appear to have had a falling out amid a growing investigation into corruption involving the state oil giant Petrobras. Since launching three years ago, the "Car Wash" probe into billions of dollars in kickbacks has put several top businessmen and politicians in jail.
Many believe that Cunha, who was widely viewed as Brazil's most powerful politician before several corruption cases began catching up with him, could provide damaging testimony about dozens of others if he reached a plea bargain with the "Car Wash" investigators.
Globo's report had an immediate impact.
Soon after it was released, both the Senate and Chamber of Deputies stopped sessions that included work on legislation that Temer's administration is pushing in hopes of kick-starting Latin America's largest economy, which is suffering its worst recession in decades.
"This climate isn't one in which to work," Rodrigo Maia, president of the lower chamber, told Globo News after adjourning legislators.
Opposition politicians took to Twitter and local news channels to call for Temer to resign or be impeached, arguing his government no longer had legitimacy.
In Sao Paulo, Brazil's largest city and the nation's economic engine, about 2,000 people gathered on Avenida Paulista to demand Temer being ousted.
"I came here because I am outraged," said Rafaela Rossi, a 32-year-old drug store owner. "How could Brazil sink so low to have this guy in office when everyone knew that he was not to be trusted?"
Globo's report represents the latest in numerous scandals that have plagued Temer, whose approval ratings are hovering around 10 per cent. In April, it came to light that eight of his Cabinet ministers are being investigated in several corruption cases related to bribery or accepting campaign donations from Brazilian constructor Odebrecht, one of the central companies that participated in the mammoth kickback scheme at Petrobras.
The Eurasia risk consultancy said the new allegation could be a big problem for Temer.
"These allegations, if proven to be true, have the potential to delve the administration into a profound political crisis," Eurasia said late Wednesday, adding that at the very least the matter will delay major reforms that Temer is trying to enact.
