Brazil's Lula says graft charges aim to destroy him politically

Lula greets supporters after giving a news conference in Sao Paulo, Brazil, Sept 15, 2016.
Lula greets supporters after giving a news conference in Sao Paulo, Brazil, Sept 15, 2016.PHOTO: REUTERS

SAO PAULO (AFP) - Brazil's former president Luiz Inacio Lula da Silva defended himself against corruption charges on Thursday (Sept 15), saying the case against him was an attempt to destroy him politically ahead of 2018 elections.

Speaking a day after prosecutors accused him of masterminding a massive pay-to-play scheme at state oil company Petrobras, the popular leftist said Brazilian "elites" were plotting his downfall along with that of his recently impeached successor, Dilma Rousseff.

Rousseff, who was convicted in the Senate on unrelated charges of accounting irregularities, was replaced on Aug 31 by centre-right President Michel Temer, her vice-president-turned-nemesis.

Lula said both cases aimed to sideline the powerful Workers' Party he co-founded in 1980.

"Like a soap-opera intrigue, they created an epilogue: They elected Temer, removed Dilma from office... and now they want to destroy Lula's political life," he said, flanked by supporters at a news conference in Sao Paulo.

Lula, a former shoeshine boy and steelworker who remains a hero to many poor Brazilians, presided over eight years of prosperity from 2003 to 2011.

The boom turned to bust under Rousseff, and Brazil is now stuck in its worst recession in 80 years.

But Lula recalled how social programmes launched during his administration helped tens of millions of Brazilians escape poverty.

"I'm proud to have created the largest left-wing party in Latin America," said Lula, 70, wearing a red Workers' Party shirt beneath a grey blazer.

Tearing up, he said he considered his greatest accomplishment to be that even poor Brazilians "can walk with their heads held high."

The gravel-voiced, charismatic leader is still seen as potential come-back material in Brazil - or was until recently.

Polls show him to be a favourite for returning to power in the next presidential elections in 2018.

But his political project is in turmoil after Rousseff's impeachment and his own legal troubles.

The charges allege that Lula and his wife received the equivalent of 3.7 million reais (S$2.3 million) in bribes.

Among the allegations is that Lula received a beachside apartment and upgrades to the property from a major construction company, OAS, which was one of the players in the Petrobras scheme.

The allegations are not new but now go before Judge Sergio Moro, head of the Petrobras investigation, who will decide whether to accept them, forcing Lula's case to trial.

Prosecutor Deltan Dallagnol singled out Lula - who was president during much of the time that Petrobras was being systematically fleeced by a network of corrupt executives and politicians - as the scheme's "supreme commander." Lula challenged prosecutors to prove his alleged crimes.

"I'm not above the law. When I break the law, punish me," he said.

"Prove my corruption and I will go hand myself in to the police."

In the scheme, Petrobras, Brazil's biggest state company, gave over-inflated contracts to other big firms, such as OAS and construction rival Odebrecht.

The network also involved high-ranking politicians who took bribes from the contractors, sometimes for their own gain and sometimes to fill party coffers to fund election campaigns.

Dozens of politicians and some of Brazil's richest businessmen have been charged or convicted.

The investigation is hugely popular among Brazilians fed up with runaway corruption, and the fallout has been widespread.

Several close allies of Temer, the new president, are now being investigated by prosecutors in the Petrobras case.

Lula was hailed internationally for combining business-friendly economic policy with social-welfare programs that helped fight centuries of deep-rooted inequality in Brazil.

He also was key in winning hosting rights to the 2014 World Cup and the Rio de Janeiro Olympics, which finished on August 21 - South America's first.

But his legacy and power base are rapidly crumbling.

The Workers' Party, which dominated Brazilian politics for 13 years, is now in peril.

A conviction would dash Lula's hopes of running for a third term in 2018.

He has already been charged with attempting to obstruct investigations in the Petrobras case, a probe dubbed "Operation Carwash."