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Last Updated: Thursday, 23 August 2007, 08:46 GMT 09:46 UK
Brazil court considers graft case
By Gary Duffy
BBC News, Sao Paulo

Brazilian President Luis Inacio Lula da Silva
The scandal threatened the president's re-election bid in 2006
Brazil's Supreme Court has begun deliberations on whether 40 people have a case to answer over one of the country's biggest corruption scandals.

They are accused of running an illegal scheme through which the governing party financed election campaigns and bribed legislators from other parties.

The scandal has forced several ministers to resign.

Meanwhile, a Brazilian archbishop has warned that corruption scandals in Brazil are weakening democracy.

High profile

The corruption hearing centres on a scandal known in Brazil as "mensalao" (the big monthly payment) because it relates to payments said to have been made each month in 2003 and 2004 to opposition politicians, to support the policies of President Luiz Inacio Lula da Silva's government.

Wednesday: Lawyers from both sides began to make their case
Thursday: Lawyers continue to present arguments
Friday: Judges retire to consider whether to accept or reject

The president always denied any knowledge of the alleged scheme, but the controversy overshadowed much of the last two years of his first term of office.

Among some high-profile victims who were forced to resign was the president's chief-of-staff, Jose Dirceu, who is among those who could face charges at the end of this hearing.

His lawyer told the court that the allegation against his client represented a piece of fiction.

Other lawyers described the allegations as inept or an imaginary creation of the prosecutor-general.

There had been no payments, one told the court.


With so many people facing potential charges, this is a complicated hearing, with legal representatives given only a limited period to set out a defence.

Corruption and impunity are leading our people to distrust politics
Archbishop Geraldo Lyrio Rocha

As the hearings got under way, a Brazilian archbishop warned that continuing corruption scandals were undermining democracy.

"Corruption and impunity are leading our people to distrust politics," Archbishop Geraldo Lyrio Rocha told a news conference.

It is a frustration shared by many Brazilians, who have seen scandals come and go for years, with few, if any, of the alleged perpetrators being punished.

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