RIO DE JANEIRO — Prosecutors on Wednesday announced new charges against Brazil’s most prominent politician, former president Luiz Inácio Lula da Silva, accusing him of controlling a multibillion-dollar corruption ring centered on state oil company Petrobras.
“Lula was the commander of the scheme,” prosecutor Deltan Dallagnol said at a news conference.
The charges could be a devastating blow for the charismatic former union leader known simply as Lula, who led Brazil from 2003 to 2010 and transformed his country with generous social programs that helped tens of millions of Brazilians escape poverty.
Brazilians had known that Lula was under investigation, and police had recommended charges against him last month for allegedly accepting improper renovations to a seaside apartment. But Wednesday’s allegations were far more serious, putting him at the center of the worst corruption scandal in the country in decades.
Prosecutors said in the indictment that after assuming power in 2003, Lula decided to create a structure to buy political support and created a “cushion” of illegal funds to fuel future campaigns for his Workers’ Party. Lula was charged with “passive corruption,” involving a scheme in which $26 million worth of bribes and favors was provided to politicians, political parties and business executives.
The Petrobras scandal caused $12 billion in losses to the company and contributed to Brazil’s severe recession. The investigation into the scandal — dubbed “Car Wash” — has left the country’s political class reeling.
“Lula was the conductor of this big orchestra formed to loot the resources of Petrobras and other public organs,” Dallagnol said. “Lula was the common and necessary link between the party and the government scheme.”
The allegations come just weeks after Dilma Rousseff, Lula’s protege and successor as president, was removed from office in an impeachment trial for breaking budget laws. Although she was not accused of personal enrichment, the public fury over the Petrobras case contributed to her ouster.
Prosecutors also said Tuesday that they were accusing Lula of money laundering, alleging that he had benefited personally to the tune of $1.1 million from the furnishing and renovation of a seaside penthouse apartment in Sao Paulo state that they said was acquired for him, and the transport and storage of gifts he had received during the eight years he governed Brazil.
The indictment includes additional charges against Lula’s wife, Marisa, and executives of an engineering firm who were accused of giving gifts to the former president in return for favors.
In a statement, Lula’s lawyers, Christiano Martins and Roberto Teixeira, said that no evidence had been presented that Lula had commanded the Petrobras scheme.
“For Operation Car Wash, Lula’s crime was having been president of the Republic,” the statement said. The lawyers also denied that Lula and his wife owned the seaside apartment in question.
Lula faces the risk that a warrant for his arrest could be issued by Sérgio Moro, the crusading judge who has been at the forefront of the investigation.
If that happens, it would be the culmination of an extraordinary downfall for the former president and his party. During 13 years of Workers’ Party rule, Brazil’s economy expanded as it rode a global commodities boom, and more than half of its 200 million citizens joined a new lower middle class.
But in the past two years, Brazil’s economy has sunk into recession and leading figures from the Workers’ Party and its political allies have been jailed in the Petrobras scandal.
In July, a court in Brasilia also accepted charges against Lula of obstructing justice in the Petrobras investigation. He has maintained his innocence.
Despite everything, Lula had retained some of his former popularity and had been expected to be a leading candidate in the presidential election in 2018.