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Click on article headlines (underlined) to go to full original article as reported.

Despite serial corruption allegations, Brazil's old guard just keeps coming back

The president of Brazil’s Senate has the power to sideline his enemies’ projects and deny them opportunities for patronage. That is why 56 senators voted for Mr Calheiros and only 18 against—even though Aécio Neves and Eduardo Campos, two probable opposition presidential candidates in 2014, had urged their parties to vote for a hastily chosen alternative. Dilma Rousseff, the president, has taken a hard line in the past by sacking ministers facing allegations of corruption. And her Workers’ Party is angry about what it sees as bias: last year’s trial of the mensalão (big monthly stipend) vote-buying scandal saw many of its members handed unexpectedly harsh sentences. But realpolitik prevailed. With the PMDB behind Mr Calheiros, Ms Rousseff accepted his candidacy and telephoned to congratulate him when he won.

Brazilian Congress elects leaders probed for corruption

In a country that has taken big strides toward greater transparency in government in recent years, the Brazilian Congress is out of step. The lower chamber of Congress voted overwhelmingly on Monday for Henrique Alves to become its speaker, even though he is under investigation for graft. The selection of Alves came after the Senate chose a new leader who is also accused of corruption. Ordinary Brazilians see the choices as a step backward in an unprecedented clean-up in Brazilian politics in the past two years that saw six ministers fired because of corruption allegations and a judiciary crackdown on political graft. Alves is a veteran of 42 years in Congress who survived corruption allegations a decade ago when his ex-wife said in a bitter divorce that he had stashed $15 million in offshore accounts. Prosecutors are still investigating her allegations. On Friday the Senate chose Renan Calheiros as its president. He was forced to resign from the post in 2007 due to a scandal involving payments by a lobbyist to maintain his former mistress. "The extracurricular activities of these two characters are well known," said political scientist David Fleischer of the University of Brasilia. "Their election is bad for Congress' worsening reputation." Both men represent states in the poorer northeast of Brazil where traditional crony politics still prevail. They belong to the largest political party, the PMDB, the most important ally in President Dilma Rousseff's coalition government. Rousseff established a reputation for not tolerating corruption by firing six ministers in her first year in office in 2011, which made her very popular among middle-class Brazilians despite a stagnating economy in the once-booming Latin American nation. She distanced herself from corruption scandals that have implicated officials in the government of her mentor and predecessor Luiz Inacio Lula da Silva. But it is the judiciary that has made the biggest splash in recent efforts to clean up Brazilian politics. In a landmark case, the Supreme Court convicted leaders of the ruling Workers' Party for buying votes in Congress to support Lula's government a decade ago. It was Brazil's biggest political corruption case and the Supreme Court did not hesitate in convicting Lula's close political associates, including his former chief of staff Jose Dirceu.


Brazilian corruption: far from over

Congress is considering a constitutional amendment that would limit the investigative powers of the Federal Public Prosecutors’ Office – precisely the institution that prepared the mensalão case for prosecution. The idea behind the amendment – sponsored by congressman Lourival Mendes, a former district police chief – is that only the police should have powers of investigation. He argues:

“The lack of clear rules defining the role of the public law enforcement agencies in the legal process has caused major legal problems for the country.” He has a point. Brazil’s system of awarding public prosecutors immense investigative independence does sometimes lead to chaos...But the independent public prosecutor system, introduced after the end of Brazil’s military dictatorship, is designed for exactly that – to create an extra layer of accountability in society that cannot be tampered with by politicians, the police or the army...Critics of the amendment have dubbed it the “bill of impunity”. They say the police, already struggling with a huge caseload, will be overwhelmed if they also have to take on the burden of the public prosecutors’ office. The result would be that many cases of public interest would never be investigated.

BRAZIL: Changing the Code on Corruption

In February 2001, Brazilian newspapers noted something different in Rio de Janeiro's annual Carnival celebration: The public officials who traditionally populated corporate boxes were no longer present. In the past, these high-profile officials received VIP treatment, with private beer companies paying for their airfare, meals, and reserved seating. The difference hinged on Brazil's year-old Public Ethics Commission. A few months earlier, the commission had published a rule that clarified what gifts, if any, senior civil servants could accept, deeming numerous perks unacceptable because they could bias politically-sensitive decisions. The rule irked powerful individuals in the private and public sectors. The media exposed three officials who flouted the rule by accepting box seats owned by Brahma beer. The commission reviewed their cases, requested explanations, and issued warnings that discouraged future violations. After the officials apologized, they promised, in writing, to obey the rule in the future. The rule and its enforcement earned public support, with one newspaper survey indicating a 98% approval rating. Senior officials now had to think twice before accepting such perks.

CASE STUDY: Inducing Honesty, Changing Norms: Government Ethics in Brazil, 1995-2004 (PDF,1.3MB)

Abstract: During the 1990s, conflict of interest scandals in Brazil weakened public trust in civil servants and rendered many competitive processes like procurement, privatization and employment inefficient and ineffective. In 1999, President Fernando Henrique Cardoso created a Public Ethics Commission to confront these problems. Led by João Geraldo Piquet Carneiro, a Brazilian lawyer, the commission developed and implemented the Code of Conduct for Senior Government Officials. Piquet first focused on the upper echelons of the civil service— public sector managers and highly visible presidential appointees. For the first time in Brazilian politics, specific rules set public standards on conflicts of interest. Within 10 days of taking office, senior civil servants had to agree in writing to adhere to the code and submit forms detailing personal and family assets. Piquet and his team developed procedures for detecting and addressing violations. The commission avoided a backlash by walking a tightrope between being a watchdog and working with senior civil servants to help separate personal and public interests. By the end of Piquet’s tenure in 2004, the commission had set a precedent. According to interviewees, norms in the upper echelons of Brazil’s federal government had changed, and senior government officials no longer had an assumed impunity. However, critics noted that the commission’s success hinged on presidential support, as the commission lost much of its momentum under the administration of Cardoso’s successor, President Luiz Inácio Lula da Silva.

Corruption in Brazil: As the historic trial of those guilty of a legislative votes-for-cash scheme draws to a close, Brazilians digest the verdict

SO RARELY has political corruption led to punishment in Brazil that there is an expression for the way scandals peter out. They “end in pizza”, with roughly the same convivial implication as settling differences over a drink. But a particularly brazen scandal has just drawn to a surprisingly disagreeable close for some prominent wrongdoers. The supreme-court trial of themensalão (big monthly stipend), a scheme for buying votes in Brazil’s Congress that came to light in 2005, ended on December 17th. Of the 38 defendants, 25 were found guilty of charges including corruption, money-laundering and misuse of public funds. Many received stiff sentences and large fines. The supreme court must still write its report on the trial, and hear appeals—though it is unlikely to change its mind. So in 2013 Brazilians should be treated to an unprecedented sight: well-connected politicos behind bars. 

First Black Court Chief Confronts Corruption in Brazil

Joaquim Barbosa once pored over law tomes while working nights as a typesetter to pay for college. Now he is rewriting them -- and the history books as well -- as the first black chief justice of Brazil’s Supreme Court and the presiding judge in a landmark corruption case. Barbosa, 58, rocketed to celebrity for his role in a trial that convicted close aides of former President Luiz Inacio Lula da Silva, who appointed him to the top court in 2003. In a country where few politicians are ever tried for corruption and virtually none go to jail, Barbosa led the way in arguing that Lula’s aides stole public money, used it to bribe lawmakers and should be punished with lengthy prison terms.

Will Brazil's 'Mensalao' corruption trial bring change?

When, four months ago, Brazil's Supreme Court began to judge one of the largest political scandals in the country's recent history, many wondered if the trial could really deliver a decisive blow against corruption. As the case approaches its end, a total of 25 out of 37 defendants have been convicted, some of them key political figures. There is still room for those who were convicted to appeal, but few think the court will change its ruling and absolve them. It has led some to say that the culture of impunity in Brazil for those who abuse their power and influence may be drawing to an end.

MENSALAO: Brazil's Lula knew about vote buying scheme - newspaper

Former Brazilian President Luiz Inacio Lula da Silva knew about and used funds from a far-reaching vote-buying scheme to pay for personal expenses, according to testimony by a convicted former consultant to the ruling Workers' Party. The testimony, reported on Tuesday by the Estado de S.Paulo newspaper, was given in September to Brazil's attorney general's office by Marcos Valerio, an advertising executive recently convicted as a bagman in the scheme.
Valerio also testified that an aide to the former president made veiled threats when the scandal erupted in efforts to keep him quiet, the newspaper said. According to the report, Valerio gave the testimony voluntarily in a bid to reduce his sentence after he and 24 other former Lula aides and associates were convicted in a landmark trial heard by Brazil's Supreme Court. Though he still received a stiff 40-year prison sentence, the circumstances of Valerio's testimony are likely to cast doubt on his claims. Among other crimes, Valerio was convicted for handling the money used in the scheme, which involved payoffs to legislators in exchange for Congressional support.
The trial exposed crimes at the core of the administration of Brazil's beloved former president and was hailed as a sign that the country is growing less tolerant of the corruption long rife in local, state, and national politics.

In Brazil, Corruption Trial Winds Down as Anti-Impunity Efforts Continue

Sentencing in Brazil’s largest corruption trial in history ended on November 28, wrapping up a phase of a landmark case that gripped the country. The Supreme Court convicted 25 of 37 defendants withsentences totaling 282 years in jail and fines of up to $10.7 million. The trial forms part of a larger effort by the judicial system and President Dilma Rousseff’s administration to curb corruption and to combat impunity. Other developments—such as sackings following new corruption allegations and government attempts to recuperate embezzled funds—also point to this undertaking.

The so-called mensalão case, or big allowance, resulted from a congressional vote-buying scandalduring former President Luiz Inácio Lula da Silva’s first administration in 2005. With high-profile convictions—including Lula’s former chief of staff, a former Worker’s Party president, and an acting São Paulo congressman—the historic case means government officials are likely to go to jail. “The trial was a watershed that will hopefully lead to a less corrupt Brazil,” said Gil Castelo Branco, secretary general of watchdog group Contas Abertas. “The conviction of several important people has sent a clear signal that things are beginning to change, that Brazilians are fed up with corruption.” Eduardo Eugênio Gouvêa Vieira, head of Rio de Janeiro’s industrial federation, told O Globo that the case “inaugurated a new phase of [Brazil’s] young democracy.” He added: “From the case emerges a country better prepared to assume the role it deserves of a political and economic power.” 

Brazil's Rousseff scrambles to contain latest scandal

Brazilian President Dilma Rousseff is scrambling to contain fallout from a corruption scandal involving government officials linked to her mentor and predecessor Luiz Inacio Lula da Silva that has given her political opponents fresh ammunition. The new scandal, which comes two weeks after the conviction of top Lula aides in Brazil's biggest-ever political corruption trial, could delay government decisions over airport upgrades and other infrastructure projects that are badly needed to make the world's sixth-largest economy more efficient. It is not, however, expected to significantly dent Rousseff's popularity or her chances for re-election in 2014, since the details of the scandal are complex and the individuals directly implicated so far are outside her inner circle. Police raided government offices in Brasilia and Sao Paulo on Friday and seized computers and data. Six people, including directors of two regulatory agencies, were arrested for using their government positions and contacts to sell approvals and favorable reports to businessmen.

Brazil's New Corruption Scandal Further Hurts Former President Lula's Reputation

Among those under investigation is the former personal secretary of ex-president Luiz Inácio Lula da Silva, Rosemary de Noronha, who has headed the regional office of the presidency in São Paulo since 2005. The bribery scandal erupted on the heels of Brazil's biggest political corruption trial that sentenced some of Lula's closest aides to prison terms for buying support in Congress for his minority Workers' Party government after taking office in 2003. Rousseff, Lula's chosen successor, was not affected by the vote-buying scandal and she has built on his popularity by gaining a reputation for not tolerating corruption. But the ruling Workers' Party was rocked by the scandal which tarnished Lula's legacy even though he was not implicated. The new corruption case could further hurt the standing of Lula, who remains Brazil's most influential politician. Friday's arrests included two brothers who were recommended for positions in the federal government by Lula's former secretary Noronha, Paulo Rodrigues Vieira, director of the National Water Agency, and Rubens Carlos Vieira, director for airport infrastructure at Brazil's Civil Aviation Agency. Police accused the brothers of recruiting second-tier government employees who would be open to bribery, while a third brother also under arrest, Marcelo Rodrigues Vieira, contacted businessmen willing to pay for false or speeded-up approvals.

New corruption scandal rocks Brazilian government

Brazilian President Dilma Rousseff, moving quickly to nip a new scandal in the bud, ordered the dismissal on Saturday of government officials allegedly involved in a bribery ring, including the country's deputy attorney general. Federal police raided government offices in Brasilia and Sao Paulo on Friday and arrested six people for running an influence peddling ring that sold government approvals to businessmen in return for bribes. Among those under investigation are the former personal secretary of ex-president Luiz Inacio Lula da Silva, Rosemary de Noronha, who has headed the regional office of the presidency in Sao Paulo since 2005. The bribery scandal erupted on the heels of Brazil's biggest political corruption trial that sentenced some of Lula's closest aides to prison terms for buying support in Congress for his minority Workers' Party government

Political corruption in Brazil: A blow against impunity

Brazil's mensalão trial has brought many historic moments and this week saw one more: an impeccably well-connected politico getting such a long prison sentence that even the best lawyer will struggle to save him from doing time. On November 12th José Dirceu, who served as chief of staff for former president Luiz Inácio Lula da Silva from 2003 to 2005, was sentenced to ten years and ten months in jail for his part in the huge vote-buying scheme. Two other prominent members of the Workers' Party (PT) also received stiff sentences: Delubio Soares, its former treasurer, got eight years and 11 months in prison, and José Genoino, its former president, six years and 11 months.

Brazilians dare to hope crackdown on corruption is real

Some Brazilians, jaded by decades of scandals in Brasília in which the perpetrators seemed to act with impunity, are suddenly daring to hope that the old ways of doing business may finally be changing in the vast emerging-market nation. Those convicted in the Mensalão include former top lieutenants of former president Luiz Inácio Lula da Silva...Among the institutional reforms, Brazil has introduced the ficha limpa, or “clean slate” law, which prevents people convicted of crimes from running for public office. A law that also prevented the Supreme Court from trying federal politicians without prior approval from Congress has been revoked. On the enforcement side, the role of the Supreme Court and independent public prosecutors, envisaged in Brazil’s 1988 post-dictatorship constitution as a check and balance on the executive, is beginning to take effect.

A Former Brazilian Presidential Aide Gets 10 Years in Vote-Buying Scheme

Brazil's high court on Monday sentenced one of the most powerful figures in the governing Workers Party to nearly 11 years in prison for orchestrating a vast vote-buying scheme, sending shock waves through Brazil’s political establishment. Justices in the Supreme Federal Tribunal, or Supreme Court, announced that José Dirceu de Oliveira e Silva, a top ally of and chief of staff to Brazil’s popular former president, Luiz Inácio Lula da Silva, was sentenced to 10 years and 10 months in prison after being found guilty of charges that are roughly the equivalent of unlawful conspiracy and bribery. The length of the sentence for such an influential political operative, who is commonly called José Dirceu in Brazil, and the mere possibility that he could spend some time in prison before being paroled, stood as precedent-setting shifts in a political culture in which impunity in corruption cases has traditionally prevailed...

Political corruption in Brazil: A blow against impunity

It sometimes appears that the Brazilian criminal-justice system locks people up on a whim. Half the prison population has either not yet been tried or is awaiting a final verdict, and much of the other half committed non-violent property or drugs crimes. But for those with resources, it allows huge scope for delay, leeway on sentencing and almost unlimited appeals. The three men, along with the other 22 who have been found guilty of crimes such as money-laundering, corruption, embezzlement and misuse of public money, benefited from a rule known as "privileged forum" which says that top politicians can only be tried for crimes in higher courts. In this case, the Supreme Court, which normally deals with constitutional, not criminal matters, had to decide to take the case. That meant that though the scandal surfaced in 2005, the trial only started this year, in August.

Brazilians dare to hope crackdown on corruption is real

The Mensalão case points to wider changes taking place in Brazil...The country is managing to couple institutional improvements with more robust enforcement. Traditionally, Latin American countries have struggled to do both in tandem. Among the institutional reforms, Brazil has introduced the ficha limpa, or “clean slate” law, which prevents people convicted of crimes from running for public office. A law that also prevented the Supreme Court from trying federal politicians without prior approval from Congress has been revoked. On the enforcement side, the role of the Supreme Court and independent public prosecutors, envisaged in Brazil’s 1988 post-dictatorship constitution as a check and balance on the executive, is beginning to take effect.

No Impunity: Brazil's court delivers a strong message

Brazil’s Supreme Court delivered a strong message on 9 October that there will be no impunity for politicians when it convicted leading members of the ruling party on corruption charges. This was part of a highly-publicised trial of 40 politicians and business people that has riveted Brazilians for months. Recent polls in Brazil had shown that most people believed the politicians would get off. 

Brazil's Supreme Follows the Money and Condemns Lula's Top Aide for Corruption

José Dirceu, Lula's Chief of Staff, Was Mensalão's Mastermind, Says Brazil Supreme

Brazil's Supreme Court convicts Lula aides of corruption

Brazil's Supreme Court convicted three top aides of former President Luiz Inacio Lula da Silva on Tuesday on charges of diverting public funds to buy political support for his leftist government when it came to power a decade ago.

In a landmark ruling, the court found Lula's former chief of staff Jose Dirceu, co-founder of the ruling Workers' Party, guilty of running a scheme of monthly payments to politicians in exchange for their votes in Congress.

The party's president at the time, Jose Genoino, and its treasurer, Delubio Soares, were also convicted of corruption. The three men face prison sentences of between two and 12 years.

Two dozen others, including 10 legislators, bank executives and business intermediaries were convicted earlier on fraud, money-laundering or conspiracy charges in the largest political corruption case in Brazil's recent history. The Supreme Court has never convicted a politician for corruption before in Brazil. Politicians have tended to get off without penalties in graft or embezzlement cases.

Brazilian Corruption Case Raises Hopes for Judicial System

Massive Corruption Scandal Is Victory for Brazilian Courts

Brazil's silent revolution

Brazilians are so used to impunity, especially when it comes to the legendary corruption in their political system, that they often employ a fatalistic maxim to describe it: The police arrest; the courts set free.

But for weeks now, Brazilians have been riveted by the televised spectacle at the nation’s high court, in which justices are sparring over what is arguably Brazil’s largest corruption scandal. When the dust settles and sentences are announced, prominent politicians and bankers may actually go to jail.

Brazilian corruption trial dims Lula's aura

Until a few weeks ago, Brazil's most popular politician and two-time president, Luiz Inacio Lula da Silva, could seemingly do no wrong.

Yet a corruption trial involving many of his closest former aides, plus new evidence that he was not the economic wizard some took him for, has tarnished Lula's reputation - and cooled speculation that he might try to return as president in 2014. Mesmerized Brazilians have watched for two months on live TV as several of Lula's former confidants stand trial on charges that they bribed legislators in Congress during his 2003-10 presidency. 

Brazilians celebrate corruption verdict

More Convictions in Mensalão Case

The Supreme Court (STF) in Brazil, deep in the middle of its long-running judgment of their biggest ever political corruption case, the mensalão scandal has now condemned 22 of the 37 accused of buying political support. In the case known officially as “Ação Penal 470,” there now seems no doubt the cash-for-votes scheme existed. Monday saw twelve more defendants found guilty, all linked to four parties allied to former President Lula’s government, and all of which had been accused of receiving money in exchange for supporting Lula’s politics.

Brazil Mensalao corruption trial reaches key stage

The judges will begin delivering their findings on Jose Dirceu, a leading figure from the government of former president Luiz Inacio Lula da Silva. Mr Dirceu is accused of overseeing a scheme that used public funds to buy support from other political parties.The case, with 37 defendants, is seen as a key test of holding Brazil's politicians to account for corruption.

Mr Dirceu, who was Lula's chief of staff from 2003 until his resignation in 2005, denies any wrongdoing. The Supreme Court justices are also due to start giving their decision on Wednesday on other key figures in Lula's Workers' Party, including the former party president, Jose Genoino, and the former party treasurer, Delubio Soares...

A majority of the judges has already rejected claims by the defence that no vote-buying scheme existed. To date, 22 of the 37 defendants have been convicted of allegations ranging from corruption to money-laundering. Four have been acquitted.

Brazil's Ruling Party Contains Damage From Corruption Trial

Lula da Silva trusted aides face overwhelming evidence of involvement in "active corruption"

José Dirceu, Lula's Chief of Staff, Was Mensalão's Mastermind, Says Brazil Supreme

Corruption in Brazil: Worth the wait

Brazil has been transfixed by the sight of its most senior judges on live television, sweeping aside legal manoeuvres in what has become known as the “trial of the century”. The mensalão (“big monthly stipend”) scandal erupted in 2005 when a politician claimed that the ruling Workers’ Party (PT) was buying his and other politicians’ votes in Congress. The cash was alleged to have come from fraudulent loans at state banks and padded advertising contracts arranged by state-controlled firms...
In August, after the hearing started, pollsters found that though four-fifths believed the accusations, only a tenth thought any of those on trial would end up in jail. Marcos Valério, an advertising man, has been found guilty of funnelling dirty money to the PT. His crimes attract a stiff minimum sentence. Senior managers from the privately owned Banco Rural and the state-controlled Banco do Brasil have also been convicted of fraud and money-laundering. That sent shivers down bankers’ spines: Brazilian bosses have always assumed that without evidence linking them directly to wrongdoing, it was enough to feign ignorance. The trial has now moved on to the politicians accused of buying and selling votes in Congress.

The Case of Brazil's Supreme Against PT Leaders Behind Mensalão to Start October 1st

The Case of Brazil's Supreme Against PT Leaders Behind Mensalão to Start October 1st

The 10 defendants facing charges of active corruption will be judged after the 13 defendants charged with passive corruption, conspiracy and money laundering have been dealt with.

The sixth chapter or part of the case goes right to the heart of the mensalão: the alleged payment of more or less regular bribes to members of Congress so they would vote with the government during the first Luiz Inácio Lula da Silva administration (2003-2005).

According to the prosecution ("Ministério Público Federal - MPF"), and the rapporteur, justice Joaquim Barbosa, who has so far followed the MPF, the payments were made by the PT to members of the PP, PL, PTB and PMDB so they would support the government. The defense admits the payments were made, but claims the money was to pay off campaign debts.

Mensalão: Brazils "trial of the century" culprits point to Lula da Silva as "the chief"

Veja published that Marcos Valerio, the publicist most involved in the case and identified as the main operator as far as the funds and their distribution, stated that Lula da Silva commanded the whole operation and “I was but a deluxe messenger; but the president he was undoubtedly the chief and well aware of what was going on”...

Last 15 August the Supreme Tribunal denied a petition to have Lula da Silva included in the massive corruption case for his involvement while president (2003/2010). However the magistrates argued that the prosecution had already excluded the former president from the case. Valerio insists that on several occasions he met with the former head of government and “everything I did President Lula was well aware”

Lula da Silva took distance from the case which blew up in 2005 and involved the whole board of the Workers Party, particularly cabinet chief Jose Dirceu, at that time the most powerful man in the presidency. But the president always denied knowledge of what was going on and said he had been betrayed by his close aides and party leaders and publicly apologized to Brazilian public opinion. “From Dirceu’s office to Lula’s it was only one floor and a few steps. We needed no appointment, Dirceu would say let’s go downstairs and there we met the big chief”, revealed Valerio...



Former Speaker of the House Found Guilty in Brazil's Mensalão Scandal

Ten of the Brazilian Supreme Court justices have now voted on the first part of Penal Case 470, known as the mensalão (big monthly allowance). This Thursday, August 30, the Chief Justice will vote, ending this first phase.

The highlight of the case so far is that eight out of the eleven justices on the court have found federal deputy, and the former president of the Chamber of Deputies, João Paulo Cunha, guilty of passive corruption and at least one count of malfeasance.

At the same time, Marcos Valério and his partners in advertising agencies, Cristiano Paz and Ramon Hollerback, have been found guilty of active corruption, embezzlement and money laundering by most of the justices who have voted so far.

The same is true of Henrique Pizzolato, a former director in the Banco do Brasil, who has been found guilty of passive corruption, malfeasance and money laundering.

First conviction in Brazil graft mega-trial

 Brazil’s Supreme Court convicted a leading politician yesterday, the first in a major bribery trial over alleged vote-buying in Congress under former president Luiz Inacio Lula da Silva. A majority of the justices on the bench found Joao Paulo Cunha, a top politician in Lula’s Workers’ Party (PT) who headed the Chamber of Deputies, guilty of bribery, embezzlement of public funds and money laundering.
Thirty-eight former ministers, lawmakers, businessmen and bankers are facing prosecution before the Supreme Court over the alleged scheme that ran from 2002 to 2005 during Lula’s first term.
Cunha, who is running for mayor in a city in the Sao Paulo region, is accused of having received 50,000 reals (about US$25,000) from an advertising agency with alleged funding ties to the PT.
The former director of marketing at the public-owned Banco do Brasil was also convicted on charges of embezzling US$37 million.

Brazil Supreme Court Rules on Mensalão Corruption Scandal

The verdict delivered this week has implications on the legacy of former Brazilian President Lula da Silva, whose government is implicated in the scandal. The case revolves around accusations that members of Lula’s Worker’s Party (PT) bribed Brazilian lawmakers to back PT initiatives in Congress using money from state-owned companies. In all, 37 defendants, including Lula’s chief of staff, José Dirceu, and other senior officials, will be judged on a variety of felony charges that include money laundering and vote-buying.

On Monday, six of the 11 Supreme Court justices weighed in on whether the former president of the Brazilian Chamber of Deputies, João Paulo Cunha, and the former director of Banco do Brasil, Henrique Pizzolato, are guilty of corruption, alongside Marcos Valério, a businessman at the center of the scandal, and Valério’s two business partners, Ramon Hollerbach and Cristiano Paz.

All justices who spoke on Monday unanimously condemned Pizzolato, Valério, Hollerbach, and Paz, though they disagreed on whether Cunha was guilty of corruption. The remaining justices are scheduled to speak on Wednesday and Thursday

In Brazil's Trial of the Century, Lula's Reputation Is at Stake

The case will decide the fortunes of some three dozen high-profile former government officials and prominent executives who stand accused of a farrago of felonies, from money laundering to buying votes. More than the fate of the 37 defendants, however, the case currently unfolding in the Supreme Court—and being followed gavel to gavel in real time by millions of Brazilians—will also say a great deal about the rule of law and the quality of democracy in Latin America’s most powerful country...Brazil’s 11 Supreme Court justices haven’t been under this much scrutiny since the trial of disgraced former president Fernando Collor de Mello, who in 1992 resigned under a cloud of misdeeds (though he was eventually cleared of corruption). And yet the scope and impact of the mensalão—according to prosecutors it stretched from the national Congress to the presidential palace—is potentially far more devastating.

First Vote on Brazil's Mensalão Is Guilty for Corruption and Money Laundering

The first vote in the mensalão trial was cast by the rapporteur, associate justice Joaquim Barbosa, more or less the equivalent of Special Master in cases of original jurisdiction...In his vote, the rapporteur found the former director of marketing at the Banco do Brasil, Henrique Pizzolato, guilty of malfeasance ("peculato" - misconduct in public office, that is, using his government position and/or government funds in illegal activities), passive corruption and money laundering. He also found adman Marcos Valério and his business partners, Cristiano Paz and Ramon Hollerbach, who ran the DNA ad agency, guilty of malfeasance and active corruption. Although not government officials, Barbosa made it clear in a long, detailed opinion that Valério, Paz and Hollerbach were engaged in the misuse of public funds for private ends - that it was government money that fed the slush fund that paid out the mensalão with the money moving from the state-run Banco do Brasil to the advertising agency, DNA.

Mensalão Defense Lawyers in Brazil Worried Justices Have Already Made Up Their Minds

"I condemn the defendant, João Paulo Cunha, for passive corruption and money laundering; for receiving an improper advantage consisting of R$ 50,000, as well as malfeasance in that he misused public funds he had access to because of the office he occupied," declared Supreme Court associate justice, Joaquim Barbosa, in the first part of his sentence last Thursday, August 16.

When the mensalão scandal became public in 2005, João Paulo Cunha was a federal deputy and the office he occupied was president of the Chamber of Deputies. Cunha survived a vote to expel him from Congress.

And then he was reelected in 2006 and again in 2010, with the result that he is one of the few mensalão defendants still in public office. In 2005, eleven of the defendants were federal deputies; today, besides Cunha, only two others are. 

Worst Corruption Case in Brazilian History Is on Trial Now by the Supreme Court


Brazil Mensalão's Whole Story: Chronologically

Mensalão scandal - Wikipedia

Corruption in Brazil: Justice delayed The politicians accused of involvement in a vast vote-buying scheme, along with their associates, will face trial at last (The Economist)

Brazil's 'trial of the century' Thirty-eight defendants are alleged to have laundered money to win votes in Congress.

Coalitional Presidentialism and Side Payments: Explaining the Mensalão Scandal in Brazil (PDF downloads immediately,24 pp.)

Defense Tells Supreme Court Mensalão Corruption Scheme Never Existed

Corruption Is Just One of 7 Crimes Mensalão Defendants Are Charged with

In Brazil's Trial of the Century Culture of Impunity Should Play Big Role

Brazil's Trial of the Century Might Prevent Lula from Running for Prez a Third Time

"Off the Books, But Not Illegal," Says Defense of Mensalão Defendants

Among the original defendants are public office holders and members of Congress, along with "civilians" in advertising agencies and financial institutions, who are charged with conspiracy, active and/or passive corruption, money laundering, malfeasance, illegal remittances of money abroad and embezzlement...there are now 36 defendants accused of participating in a vote-buying scheme in which members of Congress were given more or less regular payments (allowances) to support the government.

The prosecution claims most of the money used to pay the allowances was illegally siphoned off advertising budgets in state-run (that is, public) banks and institutions.

On Monday, August 13, defense lawyers used their time (an hour) to continue the strategy of admitting that their clients received money, but denying there was anything illegal. The money, according to the defense narrative, was legal although off-the-books.  And it was used not to buy votes but to pay campaign debts.

Poll: Brazilian government approval ratings high, despite corruption trial

Lessons from "the mensalão": Brazil's largest-ever corruption trial

Anti-Corruption and Anti-Money Laundering. The mensalão shows the clear connection between corruption and money laundering, and the need to tackle both in tandem. For example, it is alleged that President Lula’s Chief of Staff laundered funds first before disbursing them to legislators to secure votes.

"Largest political corruption case in Brazil's history" trial hailed as good sign for Brazil

Brazil's Supreme Court began deliberations Thursday in a case involving a cash-for-votes scheme that could tarnish the legacy of hugely popular former President Luis Inacio Lula da Silva and the ruling party.

Despite dredging up details of what some call the largest political corruption case in Brazil's history, the Supreme Court trial is also being hailed as a sign of political health in a country where public service has long been marred by corruption and impunity.

"It's a change of game. Brazilians are going to see someone accused of corruption really go to trial, maybe get convicted. Impunity no longer operates," said David Fleischer, a political scientist at the University of Brasilia. "This is going to turn a page. In the future, politicians will be very careful, much more cautious about how they do things."

The main defendant is Jose Dirceu, a former chief of staff for Silva, who left office with an 87 percent approval rate. It also involves 37 other members of the ruling Workers' Party. Silva himself is not accused of any accused of orchestrating regular bribes to legislators from allied parties to secure their votes...The case is known in Brazil as "mensalao," or big monthly allowance, for the sums of up to $10,000 allegedly handed over to politicians.



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