Sao Paulo state prosecutors said Thursday they filed money laundering and criminal misrepresentation charges against former President Luiz Inacio Lula da Silva because of evidence he and his family unduly benefited from a real estate scheme that adversely affected thousands of Brazilian families.
Lead prosecutor Cassio Conserino said at a news conference that the former president and his family were swept up in a yearslong investigation into wrongdoing at a failed cooperative in Sao Paulo that sold apartments at cost. The case hinges around a triplex in one of the residential towers built by the cooperative, which prosecutors allege was destined for Silva and his family.
Silva has denied any wrongdoing and said he is not the owner of the apartment in the coastal city of Guaruja.
The state public prosecutors' office brought the charges against Silva, as well as money laundering charges against his wife and one of his sons, late Wednesday.
The judge in the case must now decide whether to accept the charges and move forward with the case.
Conserino said he had no idea when that might happen, suggesting that due to sheer volume of the case it might take some time.
Conviction on the two charges could carry a maximum sentence of 13 years in prison.
Last Friday, federal investigators said they were looking into whether renovations at the Guaruja beachfront apartment and another project at a country house used by Silva and his family constituted favors in exchange for political benefit.
Both places have undergone major renovations paid for by construction companies that for decades have had contracts with the federal government. Those enterprises are also at the center of the scandal gripping the state energy company, Petrobras, in which prosecutors allege $2 billion was paid in bribes to obtain contracts with the company.
Silva acknowledges having visited the penthouse twice, but says he never owned the apartment. He claims the country house belongs to friends who allowed him and his family to use it.
Federal investigators are also trying to determine if Silva sold his influence in the current administration of President Dilma Rousseff in exchange for speeches and donations to his nonprofit foundation Instituto Lula.
Jair Jaloreto, a Sao Paulo-based expert on money laundering, said the penthouse case is "very confusing indeed."
"I see more risk for Lula (Silva) in the investigations into the country house. If he didn't deliver the speeches he was paid for, that could also be money laundering. But this apartment case is difficult. He never used it, there is no document saying it was his. It will be tough for the investigators to prove," Jaloreto said.
Silva governed from 2003 to 2010. Despite a votes-for-bribes scandal that took down his chief of staff and others, he left office with record high popularity levels and his hand-picked successor, Rousseff, handily won the presidency.
Silva and Rousseff have seen their popularity nosedive as Brazil has slipped into its worst recession in decades and corruption investigations have spread. Rousseff's approval ratings dipped into single digits at one point, but have rebounded slightly. She is facing an impeachment effort in congress.