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Monday, May 4, 2015

Lula Is Under Investigation For Influence Peddling

May 4, 2015 10:49 am

Prosecutors in Brazil investigate Lula for alleged influence peddling

Former Brazilian President (2003-2011) Luiz Inacio Lula da Silva gestures during a meeting with the Workers' Party (PT) members in Sao Paulo, Brazil on March 30, 2015 AFP PHOTO / Nelson ALMEIDA©AFP
Former Brazilian president Luiz Inacio Lula da Silva
Brazil’s federal prosecutors have opened a preliminary investigation into the country’s wildly popular former leader Luiz Inácio Lula da Silva for illicit influence peddling in Cuba, among other countries, putting further pressure on his embattled protégée President Dilma Rousseff.
The prosecutors’ office in Brazil’s capital Brasília confirmed late on Sunday reports by a local magazine that Mr Lula da Silva is being questioned by their anti-corruption unit over claims he helped construction conglomerate Odebrecht win contracts overseas between 2011 and 2014.
Weekly magazine Época alleged on Friday that Mr Lula da Silva improperly used his influence to obtain loans from Brazil’s state development bank BNDES for Odebrecht’s dealings in Cuba and the Dominican Republic, often travelling to meet the countries’ leaders at the company’s expense. The magazine also accused Mr Lula da Silva, one of the founders of the ruling Workers’ Party (PT), of similar influence peddling in Ghana and Angola.
Mr Lula da Silva, Odebrecht and BNDES have denied any wrongdoing.
The prosecutors’ inquiry – a preliminary step to decide whether to launch a formal investigation – comes as his successor Ms Rousseff is already facing calls for her impeachment over a multibillion-dollar corruption scandal at state-controlled oil company Petrobras. While Ms Rousseff has not been accused of involvement in the bribery and kickback scheme, she was chair of the company when much of the graft unearthed by prosecutors allegedly took place. The PT’s treasurer has also been jailed in connection to the scandal.
“We see the investigation against Lula as meaningful, and a reinforcement of our assessment that Rousseff’s larger economic and political liabilities in fact rest with the potential for the corruption probes to grow,” Christopher Garman at Eurasia Group wrote in a note.
“Federal prosecutors and police are clearly in overdrive mode and see this as their moment to rid the public sector of corruption,” he said.
If evidence emerges of wrongdoing by BNDES, the case would gain further significance given the vast size of the development bank, Mr Garman wrote.
“If [BNDES] is implicated, the risk of investigations bleeding into other sectors of the economy is acute,” he wrote, although adding that claims of influence peddling are “vague” given that Mr Lula da Silva was not president at the time.
In a speech to celebrate International Worker’s Day on Friday, the former president told adoring crowds that magazines such as Época and Veja, which frequently criticise him, were “worthless trash”.
“Put together 10 journalists from Veja and from Época and they won’t have even 10 per cent of the honesty I do,” Mr Lula da Silva said.