Brazil: judge halts Lula’s appointment to cabinet amid corruption scandal

Brazil’s wildly chaotic and increasingly tense political crisis has taken another twist after a judge suspended former president Luiz Inácio Lula da Silva’s appointment to cabinet moments after he was sworn in.

The decision on Wednesday by president Dilma Rousseff to appoint Lula as her new chief of staff prompted anti-government demonstrations across Brazil, as a secretly recorded phone call between the two suggested his appointment to a ministerial position was motivated by a desire to avoid prosecution in Brazil’s worst corruption scandal.

Judge Sergio Moro, the lead prosecutor in Operation Lava-jato, a two-year investigation into corruption at Petrobras, a state-run oil company, released nearly 50 audio recordings of police wiretaps to the media on Wednesday evening, prompting chaotic scenes in Congress as opposition deputies demanded Rousseff’s resignation.

Thousands of Brazilians gathered in São Paulo, Brasília, Belo Horizonte and other major cities on Wednesday night to demand the president’s resignation. In Brasília, riot police fired teargas and stun grenades at more than 5,000 demonstrators outside the presidential palace and congress building. Many waved banners calling for Lula’s arrest. Thousands more demonstrators packed the main Avenue Paulista in São Paulo.

On Thursday morning Lula was sworn in as a cabinet minister despite protests both inside and outside the presidential palace.

Supporters in the gallery where the ceremony took place chanted Lula’s name as he walked in, while an opposition congressman who shouted “shame” was quickly bundled out.

Moments later, Itagiba Catta Preta Neto, a judge from a federal court in Brasília granted an injunction against Lula’s appointment, claiming the move could compromise a police investigation.

But government officials expressed confidence that the ruling would soon be overturned by a higher court, possibly even later the same day. It subsequently emerged that the judge who authorised the injunction had posted numerous Facebook photos of himself attending anti-government protests.

On Wednesday, Rousseff had justified the decision to appoint Lula as cabinet chief by arguing that his political skills would strengthen her government, but critics say it is an attempt to shield the former president, who is under investigation for corruption and money-laundering, from prosecution.

Under Brazilian law, government ministers can be tried only in the “privileged forum” of the supreme court. Opposition activists believe any trial in Brazil’s highest court is likely to progress much more slowly than in the federal court.

They also believe the supreme court justices – many of whom were appointed by Lula and Rousseff – may prove more sympathetic than Moro, who has handed down severe sentences for some of Brazil’s top businessmen found guilty of involvement in the Petrobras scandal.

In the most damaging conversation, recorded early on Wednesday afternoon, Rousseff tells Lula she is sending him over his ministerial papers “in case of necessity”. The Brazilian media and opposition have interpreted the remarks to mean that she was giving him the papers quickly so that Lula could show them to police to avoid detention.

A note published on the presidential palace website late on Wednesday disputed the opposition’s interpretation of the call. It stated that Rousseff sent Lula the terms of office for him to sign in case he was unable to attend the swearing-in ceremony. It also said the presidency would be pursuing legal action against Moro.

Lula is accused of receiving benefits-in-kind from construction companies involved in the Petrobras scandal. Prosecutors allege he is the real owner of two luxury properties registered in the names of others. Lula denies the charges.

On 4 March he was briefly detained by police in São Paulo and taken in for “coercive questioning”, along with his wife, Marisa Letícia, and his eldest son, Fábio Luiz. On his release, an emotional Lula told supporters he had felt he had been kidnapped and questioned why Moro had used such an aggressive tactic when he had repeatedly offered to testify over the case.

That same day he also vented his frustrations to Rousseff, in another phone call that was secretly recorded by investigators and released by Moro.

In that recording Lula lambasted Moro’s actions as “an unprecedented firework display”, after Rousseff noted the coincidence of damaging revelations being leaked to the press the day before his detention.

Lula and Rousseff at the presidential palace on Thursday. Photograph: Eraldo Peres/AP

Lula added that the prosecutors in charge of the case “think that with the press leading the investigative process they are going to re-found the republic. We have a totally cowardly supreme court, a totally cowardly high court, a totally cowardly parliament … a speaker of the house who is fucked, a president of the senate who is fucked, I don’t know how many legislators under threat, and everyone thinking that some kind of miracle is going to happen.”

Notably, however, in that same conversation Lula also said he “would never enter government to protect myself”.

The federal police’s decision to record the phone conversations between the former and current president and Moro’s decision to release them to the press has come in for severe criticism, even by those appalled by Lula’s decision to join the government.

The judge justified the decision by stating that the conversations were in the public interest. “Democracy in a free society requires that the governed know what their governors are doing, even when they try to act in the dark,” he wrote.

Moro also said he believed Lula had been warned about the raid on 4 March and may have known his phone was tapped.

On Thursday morning, while Lula was being sworn in, thousands of protesters congregated outside the presidential palace. Government supporters, dressed in the red colours of the ruling Partido dos Trabalhadores (PT), squared off against protesters dressed mainly in the yellow and green strip of the Brazilian football team.

At various points throughout the morning a police cordon establishing a 50-metre gap between the two groups partially broke down, as anti-government activists tore through the police lines to taunt the other side.

Anti-government protesters take to the streets of São Paulo. Photograph: Paulo Whitaker/Reuters

“I came here for free,” they chanted, referring to the widespread allegation that PT supporters are in the pay of the government. “Fascists, fascists,” the government supporters shouted back. Police on horseback moved in on several occasions to restore order as firecrackers exploded and threats were exchanged.

Photojournalist Karina Zambrana, 26 said she was attending the pro-government protests in defence of democracy. “This is a very dangerous moment,” she said. “The major media organisations in Brazil are whipping people into a frenzy so they want war. We don’t want war. We are here for democracy.”

Civil servant Dimitri Silveira, 33, said he was not looking for conflict but protesters were seeking to provoke government supporters. “We don’t want conflict. We want to defend our democratically elected president but it seems all of our country’s institutions – the police, the judiciary – are against us,” he said.

Anti-government activists, however, have vowed to continue demonstrating until Rousseff leaves office.

“[This government] are robbing us and they have no shame,” Gustavo Bertosi, a 23-year-old law student said. Asked whether he thought there was the possibility of conflict between the two sides, he smiled and said yes.

Ernesto Junior, 42, who described himself as a failed businessman, said: “I just want what is best for the country. It’s not about right or left. No one can accept what is going on.”

In São Paulo, Brazil’s economic capital, about 1,000 people gathered in the city’s central avenue at lunchtime. Vanessa Katagueyama, 43, a tax analyst was taking advantage of her lunch break to protest. “Dilma knew everything,” she said. “We want them to fall and then we want new elections.”

A Lula supporter weeps as he holds a photo of the former president during a rally in São Paulo. Photograph: Joedson Alves/AP

Silva Regina Gonçalves, a 54-year-old psychologist, said she wanted to vote the extreme right into power. “I want to destroy the left, and these corrupt communists in our country,” she said. “Communism kills people.”

On top of the corruption allegations, Brazil is suffering from its worst recession in at least 25 years, with the economy shrinking 3.8% last year and the forecast for 2016 is similar.

Rousseff also faces separate impeachment proceedings amid allegations she illegally used state banks to plug budget deficits. Another case against her, in the supreme electoral court, claims her presidential campaign in 2014 was financed with cash from the Petrobras scandal.

Last week, Rousseff told the press she had no intention of resigning.

Brazil’s entire political class is in the line of fire. Opposition politicians who attempted to join Sunday’s anti-government protests were booed and forced to leave.

Alongside Lula and Rousseff, Brazil’s vice-president, the speaker of the house, president of the senate and main opposition leader have been accused of involvement in the Petrobras scandal.

Further demonstrations are expected on Thursday evening.