Investigators allege that Mr Virzi received a $10m-kickback (Â£6.5m) from a company which won a lucrative irrigation contract, which he denies.
The company's executives were arrested days ago trying to leave Panama.
Mr Virzi is the latest in a series of high-ranking officials from former administrations to face investigation.
In January, the Supreme Court appointed a special prosecutor to investigate claims that former President Ricardo Martinelli had inflated multi-million dollar contracts during his time in office from 2009 to 2014.
Mr Martinelli denied the allegations and said they were part of a political vendetta waged against him by his successor in office, Juan Carlos Varela.
Mr Varela, who was elected last year, campaigned on a promise to clean up Panamanian politics.
The investigation into Mr Virzi centres around allegations that he received $10m from a company hired by the government of Mr Martinelli to build a huge irrigation system in the Tonosi region of Panama.
At the time of the alleged payment, Mr Virzi was no longer vice-president but investigators said he still had close links with the government.
On Monday, Mr Martinelli defended Mr Virzi, whom he referred to by his nickname, Pipo.
The former president said that "for 40 years we have conducted all kinds of legal business with Pipo Virzi, buying, selling, renting and borrowing. Why is this getting so much negative attention?".
The irrigation system was never built and the company's chief executives are under arrest.
Mr Virzi has been charged with money laundering and corruption.

Claire Rafferty and Danielle Carter are recalled to a 23-player squad.
The Lionesses qualified for next summer's finals with a 7-0 defeat of Serbia in June.
They host Estonia at Meadow Lane on 15 September before concluding their campaign in Leuven on 20 September.
Sampson said: "We may have qualified for the Euros but our focus for our last two qualifiers is absolute.
"We know we face two challenging matches but our focus is two wins to go to the Netherlands as group winners."
England are two points clear of second-placed Belgium in Group 7.
England women's squad:
Goalkeepers: Karen Bardsley (Manchester City), Siobhan Chamberlain (Liverpool), Rebecca Spencer (Chelsea).
Defenders: Laura Bassett (Notts County), Lucy Bronze (Manchester City), Gilly Flaherty (Chelsea), Steph Houghton (Manchester City), Claire Rafferty (Chelsea), Alex Scott (Arsenal), Demi Stokes (Manchester City), Casey Stoney (Arsenal).
Midfielders: Mille Bright (Chelsea), Isobel Christiansen (Manchester City), Jade Moore (Notts County), Jordan Nobbs (Arsenal), Jo Potter (Notts County) Jill Scott (Manchester City), Fara Williams (Arsenal).
Forwards: Karen Carney (Chelsea), Danielle Carter (Arsenal), Rachel Daly (Houston Dash), Gemma Davison (Chelsea), Nikita Parris (Manchester City).
A court ordered on Wednesday that Panama's former Vice-President Felipe Virzi be held while he is investigated for alleged corruption.
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England women's coach Mark Sampson has named uncapped midfielder Millie Bright in his squad for this month's Euro 2017 qualifying double-header against Estonia and Belgium.