CURITIBA, Brazil (Reuters) - Brazilian prosecutors charged ex-President Luiz Inacio Lula da Silva on Wednesday with being the “boss” of a vast corruption scheme at state oil company Petrobras, in a major blow to the leftist hero’s hopes of a political comeback.

Brazil's President Luiz Inacio Lula da Silva talks with his wife Marisa Leticia during a ceremony at Planalto Palace in Brasilia, June 26, 2007. REUTERS/Jamil Bittar/File Photo

It was the first time that Lula, still Brazil’s most popular politician despite corruption accusations against him and his Workers Party, was charged by federal prosecutors for involvement in the political kickbacks scheme at Petroleo Brasileiro (PETR4.SA), as the company is officially known.

Public Prosecutor Deltan Dallagnol told a news conference that Lula will be charged with corruption and money laundering for leading a kickback scheme that caused an estimated 42 billion reais ($12.6 billion) in losses to Petrobras shareholders and tax payers.

“He was the conductor of this criminal orchestra,” Dallagnol said during a detailed presentation of the investigation. “The Petrobras graft scheme aimed at keeping the Workers Party in power by criminal means.”

Lula’s lawyers said prosecutors lacked evidence to back up their accusations which were part of political persecution to stop him running in the 2018 election.

“This Lula-centered farce was trumped up as an affront to the democratic state and intelligence of Brazilian citizens,” one of Lula’s lawyers, Cristiano Zanin, told reporters in Sao Paulo.

Dallagnol stopped short of saying investigators would seek an arrest order for Lula, who became a hero to many poor Brazilians during his 2003-2010 government.

The two-year-old Operation Carwash anti-corruption investigation, based in the southern Brazilian city of Curitiba, has uncovered how political appointees named by Lula’s Workers Party and its allies handed overpriced contracts to engineering firms in return for illicit party funding and bribes.

The scandal helped topple the Workers Party from power last month by crushing the popularity of Lula’s chosen successor, Dilma Rousseff. She was impeached by Congress on unrelated charges of breaking budget rules, amid rising anger over her handling of Brazil’s worst recession since the 1930s.

Dallagnol said that Lula, because of his control of the machinery of the Workers Party and the Brazilian government, was the central figure in the scheme.

Prosecutors allege that the charismatic former union leader had personally received some 3.7 million reais ($1.11 million) in bribes, including a luxury apartment on the coast of Sao Paulo from one of the engineering and construction firms at the center of the bribery scandal, OAS.

Lula has denied ownership of the three-floor condo in Guarujá.

Related Coverage Brazil prosecutors say Lula was 'general' of vast Petrobras graft scheme

Lula’s case will go before crusading anti-corruption Judge Sergio Moro, who has jailed dozens of executives and others involved in the scheme.

Former first lady, Marisa Leticia Lula da Silva, has also been charged.

Lula has separately been indicted by a court in Brasilia for obstruction of justice in a case related to an attempt to persuade a defendant in the Petrobras scandal not to turn state’s witness.

BLOW TO LULA MYTH

Lula, 70, has not ruled out running again for president in 2018, but a criminal conviction would bar him from being a candidate for the next eight years.

His fall, as well as that of the leftist party he founded in 1980, has been dramatic.

A one-time shoeshine boy and union leader who led massive strikes against Brazil’s military dictatorship, contributing to its downfall, he was elected the nation’s first working class president in 2002 after three failed campaigns.

Wildly popular with Brazil’s poor, Lula’s social policies helped yank millions out of poverty and into the middle class, and he left office in 2010 with an 83-percent approval rating and an economy that grew at a blistering 7.5 percent.

But two years ago, as the Petrobras probe became public, prosecutors began to slowly put Lula in their crosshairs.

Many prosecutors and investigators say they cannot imagine such a powerful figure was unaware of the institutionalized corruption and political kickbacks taking place at Petrobras and other state-run companies.

Marcos Troyjo, a former Brazilian diplomat and co-director of Columbia University’s BRICLab in Rio de Janeiro, said he thinks Wednesday’s charges are the first of many Lula will be facing in the coming months.

“That means the Workers Party, which may have thought it would move comfortably into the opposition after Dilma’s impeachment, will confront extreme challenges,” said Troyjo. “It’s certainly the beginning of the end to Lula’s presidential aspirations for 2018.”

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Recent polls have shown that despite the investigations targeting Lula and the Workers Party, he would be a favorite to win the next presidential election.

“But these charges are likely too big a blow to the political myth of Lula, to the candidate Lula and to the Workers Party as a whole for that to happen,” Troyjo said.</s>(CNN) Here's a look at the life of Brazil's former president Luiz Inacio Lula da Silva.

Children: with Marisa Letîcia Lula da Silva: Luis Claudio (1985), Sandro (1979), Fabio (1975), Marcos (1970, from her first marriage and adopted by da Silva); with Miriam Cordeiro: Lurian (1974)



He goes by the nickname Lula, which he formally added to his name in 1982.

Da Silva's father was against education and believed supporting the family was more important, so da Silva didn't learn to read until age 10 and began working full-time at 12.

He left school completely after the fifth grade to work full-time.

Has nine fingers, having lost the little finger on his left hand in a work accident.

First wife, Maria, died of hepatitis in her eighth month of pregnancy along with the child.

Unhappy with the lack of political representation of the working class in Brazil, he decided to get involved in politics.



1966 - Becomes a metalworker and is active in the metalworkers union.

April 19-May 19, 1980 - As one of the leaders of a metalworkers union strike, is arrested after police confront workers and held for 31 days.

November 1982 - Comes in fourth in the gubernatorial race for the state of Sao Paolo.

1989, 1994, and 1998 - Is the Workers' Party candidate for president; he comes in second each time.

October 27, 2002 - Is elected president in a runoff election with 61.3% of the vote.

October 29, 2006 - Wins a second four-year term in office with 61% of the vote.

September 30, 2008 - Reacts to the downturn in global and U.S. markets: "We can't be turned into victims of the casino erected by the American economy."

April 2010 - Is voted number one of Time magazine's 100 Most Influential People in the World for 2010.

October 29, 2011 - Is diagnosed with throat cancer and will undergo chemotherapy to treat a malignant tumor in his larynx.</s>RIO DE JANEIRO (AP) — Brazilian federal investigators have charged former President Luiz Inacio Lula da Silva with money laundering and corruption.

The charges announced Wednesday are in connection with a sprawling corruption investigation at state-run oil giant Petrobras.

Silva, his wife and five others are accused of illegally benefiting from renovations at a beachfront apartment in the coastal city of Guaruja, in Sao Paulo state. The improvements were made by constructors involved in the kickback scheme emanating from Petrobras.

FILE - In this Aug. 29, 2016 file photo, Brazil's former President Luiz Inacio Lula da Silva attends the impeachment trial of suspended President Dilma Rousseff in Brasilia, Brazil. Federal investigators charged Lula with money laundering and corruption on Wednesday, Sept. 14, 2016 in connection with a sprawling corruption investigation at state-run oil giant Petrobras. (AP Photo/Eraldo Peres, File)

Silva acknowledges having visited the penthouse but says he never owned it.

Police recommended the charges last month. Judge Sergio Moro must now decide whether Silva will stand trial.

In a separate case related to Petrobras, Silva will go on trial charged with obstruction of justice.</s>BRASILIA, Sept 14 (Reuters) - Brazilian prosecutors have filed corruption charges against former President Luiz Inacio Lula da Silva and his wife in the sprawling Petrobras kickback scandal, GloboNews TV reported on Wednesday.

This was the first time Lula, still Brazil's most popular politician despite corruption accusations against his Workers Party, was charged directly by federal prosecutors for involvement in the graft scheme at the state-run oil company. His case will go before crusading anti-corruption judge Sergio Moro. Prosecutors will hold a news conference at 3 p.m. (1800 GMT). (Reporting by Anthony Boadle; Editing by Jonathan Oatis)</s>CURITIBA, Brazil, Sept 14 (Reuters) - Brazilian prosecutors filed corruption charges on Wednesday against former President Luiz Inacio Lula da Silva, his wife and six others in the sprawling Petrobras kickback scandal.

This was the first time Lula, still Brazil's most popular politician despite corruption accusations against him and his Workers Party, was charged by federal prosecutors for involvement in the massive graft scheme at the state-run oil company.

Lula's case will go before crusading anti-corruption Judge Sergio Moro, who has jailed dozens of executives and others involved in the scheme.

Lula could face arrest for receiving a luxury apartment on the coast of Sao Paulo from one of the engineering and construction firms at the center of the bribery scandal. Lula has denied ownership of the three-floor condo in Guarujá.

Federal police urged prosecutors last month to bring charges against Lula and his wife, accusing them of receiving some 2.4 million reais ($747,896) in benefits from the builder OAS in relation to the apartment.

Lula, a charismatic former union leader who was a two-term president from 2003 to 2010, has separately been indicted by a court in Brasilia for obstruction of justice in a case related to an attempt to persuade a defendant in the Petrobras scandal not to turn state's witness.

Lula's fall, and that of the leftist party he founded in 1980, has been dramatic.

Last month, his protégé and successor as president, Dilma Rousseff, was removed from office in an impeachment trial.

Rousseff's fall was driven by Brazil's worst recession since the 1930s and its biggest ever corruption scandal, which has implicated dozens of politicians from her ruling coalition, including several in the Brazilian Democratic Movement Party led by current President Michel Temer. (Reporting by Anthony Boadle; Editing by Jonathan Oatis)</s>Brazilian federal investigators have charged former president Luiz Inacio Lula da Silva with money laundering and corruption.

The charges are in connection with a sprawling corruption investigation at state-run oil giant Petrobras.

Silva, his wife and five others are accused of illegally benefiting from renovations at a beachfront apartment in the coastal city of Guaruja, in Sao Paulo state.

The improvements were made by constructors involved in the kickback scheme emanating from Petrobras.

Silva acknowledges having visited the penthouse but says he never owned it.

Judge Sergio Moro must now decide whether Silva will stand trial.

In a separate case related to Petrobras, Silva will go on trial charged with obstruction of justice.</s>Brazil's Lula says charges aimed at wrecking his political career

SAO PAULO, Sept 15 (Reuters) - Brazilian former President Luiz Inacio Lula da Silva on Thursday dismissed corruption charges against him as a fabrication and said he was being framed to stop him from running for the presidency in two years time.

Still Brazil's most popular politician despite involvement of his Workers Party in the massive Petrobras graft scandal, Lula cried and laughed as he dismissed charges that could lead to his arrest and end his political career.

"Prove I committed one act of corruption and I will walk to the police station and hand myself in," the gravelly-voiced Lula said at his first public appearance since he was formally charged on Wednesday.

Prosecutors charged him with corruption and money laundering for allegedly taking bribes disguised as favors from an engineering firm implicated in the sprawling bribery and political kickback scheme at Petrobras, the state-run oil company.

Tears came to Lula's eyes as he recalled going hungry as a child before he rose to become a union leader, founded Latin America's most important leftist party, and was elected as Brazil's first working-class president.

The 70-year-old Lula was a hero to many poor Brazilians during his 2003-2010 government, which helped to raise more than 30 million people out of poverty.

Lula said he would collaborate with prosecutors because he had committed no crime, and he pleaded for respect for his wife, who has also been charged in a case involving a luxury apartment in the coastal resort of Guarujá that prosecutors allege was given to Lula as a bribe by construction company OAS.

Lula has not ruled out a presidential bid in 2018; polls show he would beat other candidates in a first round but lose a runoff. However, a criminal conviction would bar him from running for eight years.

With its former treasurer in jail and other party members under investigation in the Petrobras scandal, Lula's party is expected to suffer big losses in mayoral races next month. Some analysts predict the party could lose half of its majors.

Lula was charged two weeks after his hand-picked successor Dilma Rousseff was removed from office in an impeachment trial that was driven by discontent with her management of the economy, now in its second year of recession.

"The damage to the Workers Party is enormous. The creator and the creation are being systematically demolished," said Thiago de Aragao, a partner at Arko Advice consultancy.

Lula's fate is now in the hands of crusading anti-corruption Judge Sergio Moro, who has until Monday to decide whether to indict the former president.

Earlier on Thursday, Moro sentenced a friend of Lula's, rancher Jose Carlos Bumlai, to nine years in jail for a fraudulent loan to the Workers Party that was allegedly repaid with a lucrative Petrobras drillship contract.

Brazilian media reported that police are investigating the Workers Party governor of Minas Gerais state, Fernando Pimentel, for facilitating loans by the national development bank BNDES to finance projects in Argentina and Mozambique by Brazil's largest builder, Odebrecht, when he was a minister in Rousseff's government.

Construction magnate Marcelo Odebrecht is serving a 19-year prison sentence for bribery, money laundering and organized crime for his part in the Petrobras scheme in which billions of dollars were siphoned off overpriced contacts with Petrobras. (Writing by Anthony Boadle; Editing by Daniel Flynn and Leslie Adler)</s>Brazil's former president Luiz Inacio Lula da Silva said on Thursday he was ready to cooperate with prosecutors because he had committed no crime and called charges against him "pure fiction" aimed at stopping him running again.

Lula cried and laughed at the first press conference since he was charged on Wednesday with corruption and money laundering for allegedly receiving bribes disguised as favors from an engineering company implicated in the massive Petrobras graft scandal.</s>Rio de Janeiro (AP) — Brazilian investigators on Wednesday charged former President Luiz Inacio Lula da Silva with money laundering and corruption, calling him the “maximum commander” of the mammoth graft scandal roiling Latin America’s largest nation.

While the charges against Silva were expected — police recommended them last month — the characterization of his role in the kickback scheme at state oil company Petrobras was stunning.

The so-called Car Wash investigation the last two years has led to the jailing of dozens of businessmen and top politicians. While Silva, president between 2003 and 2010, has long been implicated, before Wednesday prosecutors had never said that he was anything more than a beneficiary.

Silva was “the maximum commander of the corruption scheme identified as Car Wash” Deltan Dallagnol, head of the task force investigating, said during a televised news conference from the southern city of Curitiba.

“We are not judging here who (Silva) is or was as a person, but what he did or didn’t do to the people,” Dallagnol said.

Dallagnol put up diagrams that purported to show Silva’s connection to various players in the kickback scheme going back more than a decade. He said prosecutors could show that Silva had met at key times with people involved in the scheme, such as Marcelo Odebrecht, the former president of the big Odebrecht construction company who has been jailed.

Dallagnol alleged that Silva, who left the presidency with very high approval ratings, used a network of illegal campaign financing and kickbacks for political support in Congress.

Silva’s lawyer, Cristiano Zanin Martins, blasted Dallagnol, saying he had shown himself unfit for the job.

“His political behavior is incompatible with the role of a federal prosecutor,” said Martins.

Despite a litany of accusations against Silva, there were only two actual charges: money laundering and corruption.

Silva, his wife and five others were accused of illegally benefiting from renovations at a beachfront apartment in the coastal city of Guaruja in Sao Paulo state. The improvements, valued at about $750,000, were made by construction company OAS, one of those involved in the kickback scheme emanating from Petrobras. Prosecutors also believe Silva benefited from OAS paying the rent of storage unit to house symbolic gifts that Silva received while president.

Silva acknowledges having visited the penthouse but says he never owned it.

Sergio Moro, the judge overseeing the probe, must now decide whether Silva will stand trial.

In a separate case related to Petrobras, Silva will go on trial on charges of obstruction of justice.

While his Workers’ Party has lost much support amid corruption scandals in recent years, Silva continues to enjoy popularity nationwide and has signaled his intention to run for president in 2018.

The yawning gap between the verbal accusations Wednesday and what Silva was accused of raised many questions about the future of the investigation.

Silva, who denies wrongdoing, has long been trying to get the cases against him removed from the jurisdiction of Moro, who has become famous for locking up prominent figures the last two years.

Legal experts said that making such drastic statements could help prosecutors retrain the case in their jurisdiction and keep the investigation in the public eye.

However, such maneuvers also come with risks.

“The harsh wording shows that the evidence might not be that great,” said Cezar Britto, former head of Brazilian Bar Association. “It looks as if the prosecutors are looking for the support of society instead of looking for more evidence.”</s>Brazil prosecutors say Lula was 'general' of vast Petrobras graft scheme

SAO PAULO, Sept 14 (Reuters) - Brazilian prosecutors on Wednesday denounced former President Luiz Inacio Lula da Silva as the 'general' in command of a vast corruption scheme at state oil company Petrobras aimed at keeping his leftist Workers Party in power.

Public Prosecutor Deltan Dallagnol told a news conference that the Petrobras scheme caused an estimated 42 billion real ($12.6 billion) in losses. Lula's lawyers said in a statement that he strongly denied the allegations and would fight the charges. ($1 = 3.3405 Brazilian reais) (Reporting by Sergio Spagnuolo; Writing by Anthony Boadle; Editing by Daniel Flynn)
Brazilian prosecutors file corruption charges against former President Luiz Inácio Lula da Silva and his wife, Marisa Letícia Lula da Silva. Federal judge Sérgio Moro will preside over his case.