Turning point in European Parliament scandal as Italian insider makes deal to lift the lid on corruption

It has already been a dramatic investigation, but the corruption scandal at the European Parliament has now taken an extraordinary lurch.

Pier Antonio Panzeri, 67, a former Italian MEP, has agreed a deal with prosecutors under which he will provide details of criminal activity in return for a reduced sentence.

He is one of four people detained in connection with the inquiry and has, according to his own lawyer, now admitted his own involvement in "corruption and criminal organisation".

Eva Kaili, who had been a vice-president of the parliament up until her arrest, is one of three other people being held in custody in connection with corruption.

She is due to appear before a Belgian court tomorrow.

The office of the country's federal prosecutor said that Panzeri had agreed to provide a swathe of information about the alleged crimes, including the people accused of taking the bribes, the people said to be giving them, the financial structures that were allegedly set up to try to evade detection and, perhaps most explosive, the involvement of other countries.

The accusations include money being offered to parliamentarians and officials by nations in return for access and support. Qatar has been strongly linked with the case. It's believed that money also came from Morocco, and was potentially transferred through a bank account in Panama.

Both Qatar and Morocco have denied funnelling money as part of an operation to gain influence.

Panzeri will still face punishment, despite his decision to help prosecutors.

He knows he will be sent to prison, albeit for less time than he would otherwise have faced, and will have his illegal assets seized - a total presently estimated by the prosecutor at around a million euros.

It is believed that he may be given a five-year prison sentence, but that most of it will be suspended and that he may be allowed to serve much of the remainder outside prison, wearing an electronic bracelet.

'He wants to see the end of the tunnel'

Laurent Kennes, one of the lawyers working with Panzeri, said that his client had agreed the deal because "he wants to see the end of the tunnel".

He said Panzeri was suffering from depression and felt he had "betrayed" the trust of people.

Another of his lawyers said that Panzeri's life had been "destroyed" by his involvement in the scandal.

The deal was announced the day after an Italian court agreed to the extradition of his daughter, Silvia Panzeri, on suspicion that she, too, was involved in the scandal. His wife, Maria, is also facing extradition.

Attention will now turn to the other three people being held in custody, including Kaili, her partner Francesco Giorgi and the professional lobbyist Niccolò Figà-Talamanca.

The four people were all arrested last month after raids at private properties, a hotel and at the parliament, which resulted in around £1.3m in cash being seized.

They are being held on suspicion of criminal organisation, corruption and money laundering.

In addition, the prosecutor is likely to investigate a much wider range of people, particularly following co-operation from Panzeri.

Already, a request has been made to lift the immunity from prosecution of two more MEPs, the Belgian Marc Tarabella and Italian Andrea Cozzolino.

Roberta Metsola, the president of the European Parliament, has promised to introduce a raft of changes to tackle corruption, including restricting the access of lobbyists and former MEPs and creating a registry of gifts and hospitality.

Kaili has already been ousted from her position as vice-president and will be replaced today.