Brazil Investigator Alleges Connection Between Murder and Corruption Scandal

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The Brazilian judge leading the nation’s largest-ever graft investigation on Friday alleged that the 14-year-old murder of a member of the ruling Workers’ Party may be connected to the corruption scandal.

Judge Sergio Moro, in documents released Friday as part of a new phase in the so-called Operation Car Wash, suggested that allegedly fraudulent loans obtained for Workers’ Party, or PT, may have been used to buy the silence of a person with knowledge relating to the death of Celso Daniel, one of the party’s founders.

In January 2002, Mr. Daniel, the former mayor of Santo André, a suburb of São Paulo, was found shot to death a few days after being kidnapped. Six men were convicted and sentenced to prison, but the case has been reopened and closed several times since.

Mr. Moro on Friday alleged funds siphoned from the state-owned oil company at the center of the complex web of bribery and coverups, Petróleo Brasileiro SA, or Petrobras, could have been used to pay hush money related to Mr. Daniel’s murder.

“It is possible this criminal scheme has some relation with the January 2002 homicide of…Celso Daniel,” Mr. Moro said in one of the documents released Friday.

Also on Friday, Brazilian federal police arrested Ronan Maria Pinto, an entrepreneur whose bus company operated in Santo André around the time of Mr. Daniel’s death, in connection with the case. Investigators allege Mr. Pinto was paid 6 million reais by José Carlos Bumlai, a wealthy rancher who is close to former President Luiz Inácio Lula da Silva, in 2004, money they suspect may have been intended to buy Mr. Pinto’s silence regarding the circumstances of Mr. Daniel’s death.

Mr. Pinto was sentenced last year to 10 years in prison on separate charges of embezzlement. He is currently appealing that sentence.

In a statement, Mr. Pinto denied wrongdoing and said he is cooperating with Operation Car Wash authorities.

The police on Friday also detained two former high-level PT officials, former general secretary Silvio Pereira and former treasurer Delubio Soares, on suspicion of accepting illegal campaign funds from Mr. Bumlai.

Federal prosecutors allege Mr. Bumlai, who was jailed last year on suspicion of corruption, money laundering and fraud in connection with Operation Car Wash, served as an intermediary to pass millions in bribes to PT coffers. The illicit funds were disguised as bank loans from the Schahin Group, a São Paulo-based conglomerate, according to authorities. Mr. Bumlai, the PT and the Schahin Group have all denied wrongdoing.

The renewed attention to Mr. Daniel’s murder could open up another potentially damaging line of investigation into the conduct of the leftist PT, which has been the main target of the bid-rigging-and-bribery probe.

President Dilma Rousseff, who is battling impeachment charges on a separate matter, hasnt been implicated in the Car Wash scandal. But many top PT leaders have been, including Ms. Rousseff’s mentor and predecessor, Mr. da Silva, who has denied any wrongdoing.

Rafael Cortez, a political scientist at São Paulo-based consulting firm Tendências Consultoria, suggested that Friday’s disclosures will amplify the government’s legal difficulties and add to Ms. Rousseff’s challenges in trying to stave off impeachment.

“Each new phase of Operation Car Wash means a new grenade thrown into the intentions of the Dilma government to avoid impeachment,” Mr. Cortez said.

Mr. da Silva’s think tank, the Instituto Lula, strongly condemned Mr. Moro’s implication that the PT and its allies may have had a connection with Mr. Daniel’s death. The judge and Mr. da Silva have sparred repeatedly, most notably after Mr. Moro last month released wiretapped conversations between Mr. da Silva and political associates, including Ms. Rousseff.

This “is more arbitrariness committed by Judge Sergio Moro against former President Lula,” the organization said. Judge Moro is “trying to involve Lula in his conspiracy theories.”

Carlos Melo, a political scientist at Insper business school in São Paulo, said that the issue of Mr. Daniel’s murder “rightly or wrongly” has long cast a shadow over the PT that refuses to go away.

“The PT has already been quite targeted, it is already fragile, this is going to make it worse,” Mr. Melo said.

 

Source: The Wall Street Journal Online – 02/04/2016

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