User:Etp01/Criminal Action 470

Criminal Action 470 (Ação Penal 470), also known as AP 470 or popularily Mensalão Trial (Julgamento do Mensalão) was a case tried by the Supreme Federal Court of Brazil. Such trial gained worldwide attention as it involved a corruption scheme implying top aides from the Brazilian presidency at the time of developing facts, as well as many political parties' members, Brazilian congressmen, bankers and advertisement agencies. The judgment itself was debated as it sparked a multitude of different points of view regarding law interpretation, biasing of the judges, and even the Brazilian judiciary system.

The action pointed out 40 defendants, resulting 24 sentenced, 13 acquitted, 2 not judged and 1 sent to a court of first instance.

Background
The Brazilian press started to disclose a corruption scheme into the federal government in 2004, when the weekly magazine Veja reported a political arrangement between the Workers' Party (PT) and the Brazilian Labour Party (PTB), the latter being financed on crucial political campaigns and nominations for state-owned companies and public positions, traded for the strengthening of government support in the congress. The revelations triggered investigations on many government instances, specially in Brazilian Post Office and eventually forced PTB president and congressman Roberto Jefferson to state in an interview to daily newspaper Folha de S. Paulo that the scheme existed, it wasn't concentrated solely on his party, and the Brazilian President Luiz Inácio Lula da Silva has been warned of such practices by him. That was the first occasion the big monthly allowances involved were nicknamed Mensalão (a neologism, the augmentative form of Mensal, or Monthly in Portuguese), although the word already existed (it was an old term to address a voluntary income tax collection, allowing the taxpayer to avoid facing a big amount to be paid after filling the adjustment form).

After those revelations, the Brazilian Congress installed investigative committees to clarify the facts, eventually leading to some representatives to be expelled from the parliament, some others to resign, and others to stay despite they suffered unapproved expelling processes.

A formal charge has been set by the Brazilian Prosecutor General at that time, Antônio Fernando de Souza, to investigate such facts, which eventually leaded to the criminal process against a myriad of defendants, to be decided into the Supreme Federal Court, since Brazilian legislation states any charges involving congressmen shall be judged on that court. Despite pressures made to include the incumbent Brazilian President into the investigations, no evidences were collected at that time to sustain such claim.

Charge
The judicial inquiry has been conducted by the Department of Federal Police of Brazil, as it involved many suspects closely tied to the federal government. The Public Ministry of Brazil formulated the prosecution and offered it to the Supreme Federal Court. The original allegation divided the defendants into three interdependent nuclei: political-partisan (involving 13 lawmakers), financial (implying banks) and marketing (enrolling advertising agencies held accountable into the fraud plot). The judges accepted the demand thus initiating the due process itself.

At that phase, 40 defendants were enrolled in the process. Many of them weren't eligible for privilegium fori benefits, triggering a discussion in the court if such actors should be segregated from the main prosecution just to be charged in lower courts. However the Court decided at first to keep all defendants under the same action as splitting the process would wound the investigations. Such decision was perceived as beneficial for the defendant's representation, as it would convey a time-consuming process eventually forcing its prescription, i.e., the automatic acquittal derived from the charges' age. Much of that feeling was based upon the fact the court is extremely overburdened and unfamiliar to decide criminal actions.

Acceptance
The prosecution was voted as valid in August 28, 2007, after 5 days of sessions when the majority of justices endorsed all 112 allegations (96 unanimously) claimed by Joaquim Barbosa, judge rapporteur for the action; thus allowing the court to trigger the next steps in the case.

A controversial case arose during that phase when private chats among justices Ricardo Lewandowski, Carmen Lúcia and Eros Grau during the prosecutor's speech were captured by camera shots and disclosed into the news, showing discussions unrelated to the trial, and eventually suggestions to merge each others' thoughts into a single point of view when voting.

Defendants' arguments
Most of the defendants argued the scheme existed but was solely mounted to finance political campaigns, not willing to bribe anyone. Such arguments were set to encircle the actions as electoral malpractices, whose would lead to milder prosecutions and eventually prescriptions, not to mention the common sense that every political party in Brazil employ such strategy (addressing no one could denounce them since all players benefit from such proceedings). Such version was widespread by the former president Lula himself, in an interview during a official trip in Paris and aired in the weekly news show Fantástico, from Brazilian broadcaster Rede Globo. Nevertheless, the case was still perceived as a vote-buying scheme, based upon some coincidences relating huge money withdrawals and important deliberations from lawmakers, exhibiting huge support from political parties denounced in the plot.

Final claim from prosecution
On July 7, 2011 the incumbent General Prosecutor of Brazil, Roberto Gurgel, claimed 37 out of the initial 40 defendants as culpable in the action. Three other people enrolled were disconsidered: Sílvio Pereira, a former General Secretary for the Workers' Party, who accepted a deferred prosecution agreement to avoid his trial ; José Janene, a former lawmaker and treasurer for Progressive Party, who died in 2010 ; and Luiz Gushiken, former Press secretary of Brazil, for absence of evidence.

Allegations
The charge pointed out a complex scheme to distribute money to some Brazilian lawmakers to ensure their votes to be cast in sensitive government affairs, harvesting such amounts from false advertisement services contracted by public companies.

The plot was described in the action as follows:


 * A political nucleus, composed by José Dirceu (Chief of Staff for the Brazilian Government), José Genoíno (President of Workers' Party), Delúbio Soares (Treasurer of Workers' Party) and Sílvio Pereira (General Secretary of Workers' Party), commanded the whole scheme, deciding which lawmakers should be bribed and the amounts to be paid;


 * An operational nucleus, whose role was to arrange the pretended advertisement contracts, to negotiate irregular loans to the involved partners, and finally spreading the harvested money to the final addressees. Such team was mastered by Marcos Valério, an advertising agency owner, along their partners Ramon Hollerbach and Cristiano Paz, his lawyer Rogério Tolentino, and his co-workers Simone Vasconcelos, Geiza Dias;
 * A financial nucleus, assembled to grant the loans needed for the whole scheme, comprising the top staff from Banco Rural, namely Kátia Rabello, José Roberto Salgado, Vinicius Samarane and Ayanna Tenório;


 * Others involved, most of them the bribed congressmen (João Paulo Cunha, Pedro Corrêa, Pedro Henry, Valdemar Costa Neto, Bispo Rodrigues, Roberto Jefferson, Romeu Queiroz, José Borba, Paulo Rocha, Professor Luizinho and João Magno); the other ones were top aides to them or their political parties (João Cláudio Genu, Jacinto Lamas, Antônio Lamas, Emerson Palmieri, Anita Leocádia and José Luiz Alves), along with Enivaldo Quadrado, Breno Fischberg and Carlos Quaglia (brokers involved into malpractices), Anderson Adauto (former Minister of Transportation), Duda Mendonça and Zilmar Fernandes (advertising specialists).

The scheme also implicated several Brazilian companies and institutions:


 * Banco Rural and Banco BMG, private banks, allegedly supplying money through false loans to advertisement agencies and the Workers' Party itself;
 * Visanet, a credit card operator for Visa in Brazil, allegedly contracting advertising services never consumated, thus providing money into the fraud. Visanet, the brand name for Companhia Brasileira de Meios de Pagamento, eventually conducted its IPO at São Paulo Stock Exchange and lately was rebranded as Cielo S.A.;
 * Banco do Brasil, the oldest, state-owned Brazilian bank, as supposedly mangled from discounts achieved from the negotiation of advertising by their agencies;
 * The Brazilian House of Representatives, again by false advertising contracts;
 * SMP&B, Grafitti, and DNA, advertising companies related to Marcos Valério, allowing the collection of capital and its distribution to the final addressees. That part of the plot was nicknamed Valerioduto, a compound word joining Valério's last name and duto (duct in Portuguese). That part of the fraud was specially outlined since it was rooted in an older plot involving the main opposition party at that time (The Brazilian Social Democracy Party in a case lately nicknamed Mensalão Mineiro, as it was established in the Brazilian state of Minas Gerais, or alternatively Mensalão Tucano, as Tucano, Toucan in Portuguese, is the party's mascot);
 * Bônus Banval and Natimar, brokerage firms, which assisted the money distribution;
 * Duda Propaganda, another advertising company, which effectively assisted the Workers' Party on 2012 Presidential campaign but allegedly received its payment thru the Valerioduto scheme to divert the money abroad;
 * The Workers' Party, Brazilian Labour Party, Brazilian Democratic Movement Party, Party of the Republic and Progressive Party, all of them exhibiting congressmen allegedly bribed.

Final Report from the Rapporteur
The final report has been delivered by Justice Joaquim Barbosa on December 19, 2011, thus allowing the judge reviser, Ricardo Lewandowski, to utter his own report, either to acquiesce or defy the rapporteur's thoughts. Such revision report was delivered on June 26, 2012.

Both facts were controversial by many reasons; The first one was that all three key people responsible by the further steps in the case (Cezar Peluso, the incumbent Chief Justice; Joaquim Barbosa, the rapporteur; and Ricardo Lewandowski, the reviser) were nominated by Luiz Inácio Lula da Silva, the Brazilian President at the time of the plot and a prominent member of the incumbent situation party (the Workers' Party), hosting the current Brazilian President Dilma Rousseff. Despite of that, Peluso succesfully rushed Barbosa to release his report, to avoid the risk of prescription; Barbosa succeded to release the report before the expected schedule; and Lewandowski seemed afraid to deliver his own report at a reasonable time to avoid such prescriptions.

However, the final reviser report was only released several months after the main report, under pressures from the incumbent Chief Justice Ayres Britto, and claims from the reviser Lewandowski stating he was compelled to speed up the process (citing that a typical criminal action would demand at least 6 months of analysis per defendant), notwithstanding the quality of the report wasn't marred. The trial was scheduled to begin on August 2, 2012.

The Preliminary Scenario at the Court
Prior to the start, the trial embedded several expectations and speculations in Brazil, because of several components:


 * The Brazilian Supreme Court has never before judged a case so complex, closely followed by the media, and triggering fiery opinions in the society (clearly dividing supporters of the government's party and their opponents);
 * Although already existing, live broadcast of the sessions through TV Justiça was a new point of attraction in the case, as it would be confirmed in the aftermath of the trial;
 * Rapporteur Barbosa was cited as a unyielding person, often colliding opinions among his peers, eventually degenerating to personal offenses; in addition, he suffers from a spinal disease (sacroiliitis), which makes very uncomfortable to him to remain seated and sparked speculations about his wealthiness to direct the whole process;
 * The court composition at that time encompassed 6 justices appointed by President Lula (Cezar Peluso, Ayres Britto, Joaquim Barbosa, Ricardo Lewandowski, Carmen Lúcia and Dias Tóffoli), 2 from Dilma Rousseff (Luiz Fux and Rosa Weber) - therefore inflating speculations about their supposed loyalty to their appointers - versus the other members (Celso de Mello, appointed by José Sarney, Marco Aurélio Mello, appointed by Fernando Collor de Mello and Gilmar Mendes, appointed by Fernando Henrique Cardoso);
 * Depending on the time elapsed to decide the case, two justices were in risk to be automatically expelled, because of a mandatory retirement rule (Cezar Peluso and Ayres Britto), which effectively happened, giving path to the incumbent President to nominate other members, potentially willing to change the court balance or at least to force the court to judge with blank seats - therefore weakening the majority decision or even to produce ties;
 * Justice Dias Tóffoli was the Solicitor General of Brazil during some part of President Lula government, and a lawyer for the Workers' Party beforehand, thus leading discussion whenever he should declare himself unsuitable to decide over such matters.
 * The Brazilian weekly magazine Veja published an article stating the former President Lula tried to pressure justice Gilmar Mendes to postpone the proceedings up to 2013, threatening him through a liaison to an investigated illegal gambling entrepreneur, nicknamed Carlinhos Cachoeira, the head of a scheme which caused a Brazilian senator to resign, Demóstenes Torres. . The conversations were supposedly witnessed by the former Chief Justice and former Minister of Defense of Brazil Nelson Jobim, who denied it, notwithstanding stating he hosted a meeting between the President and the justice in his office. The same article pointed out presumed attempts from Lula to exert pressures over other justices, since 2012 was a year of municipal polls.

Trial
The trial effectively started on August 2, 2012 as scheduled.

The initial procedures
The first day in court has been spent revisiting an old discussion, should the process be split or not since it involved defendants supposedly not suited to be judged by the Supreme Court, as they no longer have (some of them never had) top government positions which turned them eligible to have such prvilegium fori. Such discussion, which was already visited by the full court in the early proceedings, was proposed by the lawyer Márcio Thomaz Bastos, a former Minister of Justice of Brazil and advocating for some of the defendants. Surprisingly the question was positively accepted by Justice Lewandowski, much to the frustration of the rapporteur Barbosa, citing "this matter was already discussed three times here, and this is the fourth one", causing the first quarrel (which would turn to be recursive) between the rapporteur and the reviser. At last the matter was defeated 9-2 by the court.

The action proceeded with the oral arguments from the current General Prosecutor of Brazil at that time, Roberto Gurgel. He argued the scheme was "the most audacious case of corruption and embezzlement of public money in Brazil", centering José Dirceu as the mastermind of the plot, and claiming 36 defendants as guilty (now citing Antônio Lamas as not guilty for absence of evidence, just like Luiz Gushiken), asking for their immediate arrest just after the condemnation.

The first impressions from the prosecution work have been considered, from some justices point of view, as containing some flaws in the allegations, as the actors in the political nucleus weren't accused of money laudering, which would weaken the accusation. The next step in the process would be the oral arguments from the defendants' lawyers, granting one hour for each defendant in the next sessions.

At that phase, no substantive facts arose, except for the rise of a procedural error from the court in prejudice of defendant Carlos Alberto Quaglia, an Argentine accused of money laundering and the only one to bear a public defender as his lawyer. According to his defense, he has changed his lawyer but wasn't notified on some steps in the process; so the court supposedly couldn't reach such defender, thus being impossible to the defendant to enroll his own witnesses in the process. The proposed solution to the matter was to split his case from the whole process so he could be judged by a court of first instance, which was eventually confirmed in a 10-1 voting. The only remarkable statements from some defendants claimed the supposed responsibility of former President Lula into the scheme, and questioning his absence in the allegations.

Rapporteur's vote started
On August 16, 2012 rapporteur Barbosa started to report his vote to the court, but he decided to offer it splitted into chapters, each one of them devoted to the different nuclei as stated by the prosecution. Such presentation was firmly repelled from the reviser, citing it was unnaceptable, since it implied as true the prosecution point of view. Many discussions arose and the Chief Justice decided every justice would utter his own vote as desired, i.e., either following the proposed splitting or shouting his full decision. After further discussions and claims om the defense lawyers, the splitting was considered valid and became the standard for the whole proceedings. Nevertheless the first conclusions from the rapporteur claimed four defendants (Marcos Valério, Cristiano Paz, Ramon Hollerbach and João Paulo Cunha) as guilty for bribery and peculation.

Fund Diversion
The rapporteur's vote indicated a scheme was assembled to divert public money from Banco do Brasil, a state-owned bank, to advertisement companies owned by Marcos Valério, through an investment fund managed by Visanet, a credit card operator partially owned from Banco do Brasil and Brazilian private banks as well. According to his report, Valério earned the money for his own benefit and to bribe congressmen at Delúbio Soares' discretion (the incumbent treasurer of Workers' Party). The whole scheme was muffled through false loans registered at Banco BMG and Banco Rural. Amounts diverted were cited as R$ 2.9 million from the advertising contracts and R$ 73.9 million from Visanet fund.

Cristiano Paz and Ramon Hollerbach were appointed guilty as they were Valério's partners in his companies and would have aided the negociations. Henrique Pizzolato, a former director for Banco do Brasil, was accused as the responsible for letting the money flow to the scheme in exchange for a allowance. João Paulo Cunha, a member of the Brazilian House and its former speaker, was cited as the addressee of a BRL 50,000 sum to establish a contract between the House and the implicated advertisement agencies. Luiz Gushiken, a former Brazilian representative, was claimed not guilty for absence of evidence on pressuring Pizzolato to make the arrangements.

† Any decision showing at least 4 votes for acquittal would be eligible for a special appeal, whose applicability was to be decided at the end of the procedures.

The justices decided to establish the sentences' length (the section of the trial called dosimetria in Portuguese) at the end of the procedures. Nevertheless that was the last session for Justice Cezar Peluso, whom would reach his mandatory retirement the next Monday, September 3, 2012 (his 70th birthday). Therefore he was the only judge to utter votes for reclusions' extents, which turned to be unusable lately at the trial aftermath.

Malpractice
The next chapter was dedicated to discuss whether the financial institutions involved had perpetrated or not financial crimes, most specifically malpractices, on granting loans for the Workers' Party and the advertisement agencies already implicated in the case. The rapporteur indicated, in his vote, that the loans were fraudulent as accountability records were lost by Banco Rural (the lender), mandatory informations for the granting were omitted, and the loans were never paid back before the installment of the criminal action, suggesting that "those loans were supposed to be never repaid.". Finally, the rapporteur stated the loans and their extensions were made to baffle the real origin of the funds and their destination to politicians, employing strategies including false risk assessments. Such understanding was largely accepted by the reviser and the court as a whole, sentencing Kátia Rabello, the main shareholder of Banco Rural; José Roberto Salgado, a former vice-president of the bank (and the incumbent one at the event of the crime); and Vinicius Samarane, the incumbent vice-president of that institution and former compliance director at the time of the facts. Ayanna Tenório, another former vice-president, was acquitted.

† Any decision showing at least 4 votes for acquittal would be eligible for a special appeal, whose applicability was to be decided at the end of the procedures.

Money Laundering
The third chapter versed about money laundering acts that would have been committed by ten defendants. The rapporteur claimed nine of them as guilty, as Ayanna Tenório, the tenth one, could not be considered guilty as the Brazilian laws at that time required that certain precedent crime needed to be committed prior to the money laundering activity itself. As she was acquitted from the malpractice allegation, this condition could not be fulfilled.

The money laundering activity was recognized by both the rapporteur and the reviser as several cheques were emitted by the advertisement agencies in favour of themselves, only to allow the withdrawal of the money to third persons, allegedly unidentified albeit the existence of clear instructions from Banco Rural to deliver the money to certain addressees, specially politicians.

This chapter was also noticeable as Paulo César de Abreu e Silva, the lawyer for the defendant Geiza Dias, used a controversial argument to claim his client as not guilty, labeling her as a "worthless worker" (funcionária mequetrefe), just to stress she was a simple submissive employee subject to her bosses' instructions and therefore not responsible for the alleged crimes. (That strategy worked: she was acquitted.)

In the development of this phase, President Dilma Rousseff appointed a new judge to the court, Teori Zavascki, as a replacement for Cezar Peluso, who experienced his mandatory retirement in the early proceedings. Therefore a new question arose: whether the new member of the court could be eligible to express his votes on this trial.

† Any decision showing at least 4 votes for acquittal would be eligible for a special appeal, whose applicability was to be decided at the end of the procedures.

Vote Buying
The fourth chapter was dedicated to demonstrate the practices involving vote buying in the Brazilian Congress, more specifically corruption practices among representatives and the Federal Government. The rapporteur stated that political parties were bribed to support the Worker's Party government, granting crucial votes to pass new legislation at the Brazilian House.