Jail term for former Brazil president gives hope justice will prevail in SA

The conviction of former Brazilian president Luiz Inácio Lula da Silva of corruption on July 12 and his sentencing to nine-and-a-half years in prison, was a once-in-several-generations type of seismic event in Brazil. No former Brazilian president had ever been convicted of a crime. The background to this event will ring familiar to many South Africans and may even give us hope for the future in our political environment.

The seeds of the conviction were sown in 2014 with what appeared at the time to the Brazilian Federal Police to be just another routine money-laundering investigation in which the suspects regularly met at a carwash in Brasília to exchange ill-gotten gains. Unfortunately for many of Brazil’s biggest companies and most prominent politicians, it was where one of Brazil’s most notorious money launderers, Alberto Youssef, changed bribes received for lucrative contracts involving state contracts for Brazil’s biggest companies, such as state oil giant Petrobras and several Brazilian construction companies. The investigation was thus called Operation Car Wash. After his arrest, Youssef started spilling the beans and the whole house of cards came tumbling down.

Brazilians have over the centuries become accustomed to corruption. But the Brazilian Labour Party and Lula took corruption to stratospheric levels. The discovery of vast oil reserves off Brazil’s coast led to many huge contracts that Petrobras awarded to several Brazilian companies. But there was a catch. Every multibillion-dollar contract included a percentage to be paid to the people involved in awarding the contracts (and ultimately to the Labour Party and its allies). This money then found its way through elaborate schemes to the carwash in Brasilia with Youssef’s assistance and finally into Swiss bank accounts, fast cars, Miami apartments and, of course, the Labour Party’s coffers.

Enter Justice Sérgio Moro, a national hero in Brazil, and the Brazilian prosecuting authorities, composed of the Brazilian Public Ministry, the General Prosecuting Authority and the Federal Police. With the information obtained from Youssef, the investigating team started intercepting the suspects’ phone calls and studied their bank records. This led them to investigate and eventually in March 2014 to arrest the former director of Petrobras’s fuel supplies division, Paulo Roberto Costa.

Costa used his position at Petrobras to consolidate the corruption scheme involving high-ranking colleagues at Petrobras, construction companies, members of Brazil’s Senate and Chamber of Deputies (its two houses of parliament), government ministers, state governors, leaders of political parties allied to the then governing Labour Party and other highly skilled money launderers. He was accused of masterminding a corruption scheme totalling several tens of billion Brazilian reais. A figure of almost 42-billion reais (about $13.35bn) has been mentioned.

The investigating authorities knew Costa didn’t do it solely for his own enrichment, and offered him a plea-bargain deal in exchange for evidence about others involved in the corruption scheme. His evidence, and that of Youssef, led to the arrest of several politicians. In October 2014 this led to Switzerland blocking more than 100 accounts of people involved in the scheme.

The defendant received an undue benefit by virtue of having been the president. The responsibility of a president is enormous, and so is his culpability when he practises crimes.

—  Justice Moro

Lula’s name was frequently mentioned as the ultimate organiser of the scheme, using the money to fund the Labour Party and to secure its place in power in Brazil, and at the end of 2015 he was asked by the authorities to give testimony. At the beginning of 2016 he was formally charged on five counts of corruption and its various guises under Brazilian law.

One of the accusations, and the one that led to his conviction by Justice Moro, was that one of Brazil’s largest construction companies, OAS, had given Lula a fabulous beachfront apartment in the coastal town of Guarujá, about 100km from Sao Paulo, and paid for its refurbishment to the tune of R3m. The total value of the bribe was calculated to be equivalent to R10m.

The court found this money came from a slush fund of 16-million reais (about $5.09m) the Labour Party held with OAS.

Moro ruled: "The defendant received an undue benefit by virtue of having been the president. The responsibility of a president is enormous, and so is his culpability when he practises crimes." During the trial, Lula denied receiving this benefit from OAS, despite contradictory evidence from OAS executives.

He accused the investigating authorities and Moro of being complicit in an opposition plot against him to prevent him from running for president again in 2018.

He is appealing against the conviction — as are the prosecutors, who found the sentence too lenient. The trials relating to the four remaining charges are pending.

Although one can hardly say corruption has been stamped out, no Brazilian politician will be likely to accept or request bribes in the brazen fashion they did before Operation Car Wash.

Why could Brazil muster the courage to get rid of corrupt politicians in an event that many commentators said would totally revamp Brazilian politics and society, while SA languishes with similarly corrupt schemes, corrupt politicians, businessmen and families?

There are several reasons but two stand out: the independence and courage of Brazil’s institutions, and popular revolt. Unlike here, where our president nominates the justices, the heads of the prosecuting authorities and special investigators, the public protector and such, in Brazil these positions are filled by public exams. Candidates who want to become prosecutors, justices and members of the federal police, must write tough exams, in which only the best and smartest pass, and even then they often have to wait a year or more to be finally hired. There is no space for the president to appoint his cronies.

However, there were attempts to influence the investigations. Before her impeachment, Lula’s successor as president, Dilma Rousseff, even tried to appoint Lula as minister in the presidency (chief of staff) to give him immunity from the lower courts of Sergio Moro (Brazilian politicians can only be tried by the Brazilian Supreme Court). However, the Supreme Court set aside that appointment, opening up the way for his conviction eventually. A recording of a telephone conversation between Dilma and Lula in which she informed him that she would be sending his appointment as minister to him so that he could have it "just in case", was made public and caused public outcry and disgust, both by supporters and opponents of Lula.

For Lula’s supporters, it was a grave violation of his privacy (why they were more worried about his privacy than by the actions the phone call revealed was never fully explained). For his opponents it was the best proof that they were being governed with impunity by corrupt politicians only interested in their own enrichment rather than in the country’s wellbeing. Brazilians descended on the streets in millions all over the country.

The pressure on Rousseff increased and she was eventually impeached for cooking Brazil’s fiscal books.

That is the second lesson for SA. Our people power is not strong enough. We complain on Twitter and Facebook, but we do nothing on the scale the Brazilian protesters did. The protests we have seen in SA so far have been laughable compared with the protests in Brazil. Zuma, the Guptas and all the other actors in our own story need to see clearly and hear loudly that we are fed up to the teeth with their shenanigans. In Brazil, the message from the streets could not be louder.

Ultimately, SA’s institutions must be more independent than they are (maybe there is scope for a constitutional amendment to achieve this). The president should not be in a position to appoint the very people who could be tasked with investigating and prosecuting him. The drafters of SA’s Constitution, when they gave the president all these powers, probably never foresaw the likelihood that the president himself would have to be prosecuted. Allowing him to control the heads of the institutions has in effect given him control over a large part of the judiciary.

Only SA’s courts are still intact, and we can only hope it stays like that.

At the end of the Lula verdict, Moro said no matter how high someone was, the law was always higher. Brazil’s politicians discovered this the hard way; it’s time for SA’s politicians to discover this too. We need a Sergio Moro in SA.

Moro, 44, has said he was inspired by Italy’s Operation Clean Hands and based his decisions on what he learnt from close study of the Italian anticorruption investigations.

In Brazil it became Operation Car Wash; maybe in SA it will become known as Operation Saxonwold Shebeen.

• Myburgh is a South African attorney and member of the Brazilian Law Society.