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Corruption Allegations Against Brazil’s Lula to Be Probed

Dec. 19 (Bloomberg) -- Brazil’s Attorney General said the country’s judiciary will investigate allegations that former President Luiz Inacio Lula da Silva took part in a cash-for-votes scheme that toppled several of his closest aides.

Last month, the Supreme Court handed down lengthy prison terms several top Lula aides for their role in the so-called “mensalao” scandal, Portuguese for the “big monthly payments” paid to lawmakers to vote with the government between 2003 and 2005.

The main conduit in the scheme, advertising executive Marcos Valerio, said in sworn testimony in September that he twice transferred funds for Lula’s personal expenses. Lula, in Paris last week when the testimony was leaked to the media, called the accusations “a lie.”

“Valerio often makes reference to declarations that he considers bombastic and, when we investigate them in depth, that’s not the case,” Attorney General Roberto Gurgel told reporters in Brasilia today. “But we are going to see what there is in the testimony that could prompt future investigations.”

While Lula’s former cabinet chief and one-time head of his Workers’ Party were convicted by the Supreme Court in the recent trial, the former president has so far remained above the fray. When the scandal broke in 2005, Lula went on national television to say he had been betrayed by his aides and had no knowledge of their wrongdoing. A year later, after being re-elected, he blamed the opposition for inventing the charges in a bid to topple his government.

No Immunity

Gurgel said that Lula lost his immunity to prosecution when he left office in 2011 and that it would be up to a prosecutor in a lower level court to investigate the case.

“I repudiate all attempts -- and this would not be the first -- to take away the immense respect the Brazilian people have for” Lula, President Dilma Rousseff told reporters in Paris last week.

In the wake of the latest accusations, the Social Democracy Party, or PSDB, Brazil’s biggest opposition party, asked federal prosecutors to open an investigation into Lula’s involvement and want Valerio to testify in Congress.

To contact the reporter on this story: David Biller in Rio de Janeiro at dbiller1@bloomberg.net

To contact the editor responsible for this story: Joshua Goodman at jgoodman19@bloomberg.net

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