Brazil house leader, ex-president hit with corruption charge

2015-08-21 14:03

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Sao Paulo - Brazil's attorney general filed corruption charges on Thursday against the speaker of the lower house of congress and against a current senator who was impeached while serving as president in the early 1990s.

The Attorney General's Office said Chamber of Deputies speaker Eduardo Cunha and Senator Fernando Collor took part in the sprawling corruption scheme at state-run oil company Petrobras, which ran for over a decade and in which billions in bribes were allegedly paid.

Both Cunha and Collor told the local press that they have done nothing wrong.

Prosecutors said in a statement that Cunha is accused of accepting $5m in bribes between 2006 and 2012 in connection with the construction of two Petrobras drilling ships. He's charged with corruption and with money laundering.

No details in the case against Collor were made public. The prosecutor's office said that was because it is based on accusations from an active informant and revealing details would jeopardise the continuing investigation.

Scandal and economic problems

In the early 1990s, Collor became Brazil's first freely elected president in nearly three decades after a long military dictatorship, but he was removed from office in 1992 over allegations he received millions from a slush fund run by his former campaign treasurer.

Under Brazilian law, charges against federal congressmen and other top government officials can only be filed and judged by the Supreme Court, which is expected to take years to rule on the cases.

The charges against both men have long been expected in the Petrobras scheme, which prosecutors say involved huge bribes to politically appointed executives at the oil company in return for inflated contracts.

Prosecutors allege some of the money made its way into campaign coffers of the governing Workers' Party and its allies as well as into the hands of dozens of lawmakers who are under investigation.

President Dilma Rousseff, whose approval ratings are in the single digits amid the scandal and economic problems, has not been accused of any wrongdoing, although she served as chairperson of the Petrobras board during several years as the scheme played out.

Rousseff, who denies any wrongdoing, has repeatedly said that the investigation will not stop and "will hurt whomever it must hurt", even as several members of her own party and those in her ruling coalition become ensnared.

Thousands of Brazilians turned out for rallies across the country on Thursday to voice support for the president, but their numbers were smaller than demonstrations on Sunday that drew protesters calling for Rousseff to lose her job.

Major threats

Analysts were split on what Thursday's charges might mean for Rousseff.

Cunha, a member of the powerful Democratic Movement Party, has for many months played an obstructionist role to Rousseff's initiatives in congress as she tries to push through austerity measures and other bills meant to help propel Brazil's economy out of the doldrums. The nation's economy is expected to contract 2 percent this year and again be in recession in 2016.

"For Dilma, this is a positive outcome since Cunha has positioned himself as one of the major threats to Dilma's political stability," said Thiago Aragao, a political analyst at Brasilia-based Arko Advice.

But he added that a weakened Cunha, who has vowed he will not resign, doesn't mean he will lose all his influence. It is possible that his "level of retaliation against Dilma and her government could increase," Aragao said. "I think there will be two to three weeks of a very tense environment."

David Fleischer, a political science professor at the University of Brasilia, said he thinks Cunha's "nastiness as president of the Chamber of Deputies will increase and he may go after Dilma with more passion and hatred than before."

"The consequences of this may be dire and produce a worse situation for Dilma ... he will vent his anger toward Dilma and spare no effort to get her impeached," Fleischer said.

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