Justice oversteps bounds in Rio Governor suspension case

. Aug 31, 2020
Justice oversteps bounds in Rio Governor suspension case Photo: Tingey Injury Law Firm/Unsplash

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This week, a look into how the Justice system has become excessively political. And a massive police operation against Brazil’s most powerful criminal organization.

Important: Next Monday is a federal holiday, Brazil’s Independence Day. Therefore, next week’s Weekly Report will be sent out on Tuesday, September 8.

What Rio governor suspension says about Brazil’s Justice system

On Wednesday, the Superior Court of Justice decides

on whether to uphold a Friday decision by one of its justices, which <a href="https://brazilian.report/newsletters/brazil-daily/2020/08/28/rio-governor-suspended-in-coronavirus-corruption-probe/">suspended Rio de Janeiro Governor Wilson Witzel</a> from office due to his alleged involvement in a corruption scheme to embezzle part of the state&#8217;s coronavirus budget. The individual decision was highly controversial, raising suspicions of being politically-driven — it also is a good example of how the Justice system operates in Brazil, writes reporter José Roberto Castro.</p> <p><strong>Exception becomes the rule.</strong> Brazilian high courts are designed to work as collegiate boards, with the intention of reaching fairer decisions. The Supreme Court has 11 justices, while the Superior Court of Justice (STJ), the second-highest judicial body in the land, has 33 members. Individual decisions should only occur in exceptional cases —&nbsp;and never in consequential decisions such as suspending a governor from office.</p> <ul><li>In 2010, the Superior Court of Justice authorized the Federal Police to <a href="https://www.correiobraziliense.com.br/app/noticia/cidades/2010/02/11/interna_cidadesdf,172899/ministro-do-stj-decreta-prisao-preventiva-de-arruda.shtml">arrest</a> a sitting governor —&nbsp;but did so only after the entire court voted on the decision.</li></ul> <p><strong>Overt politicization of Justice.</strong> Both Brazilian courts and the Federal Prosecution Office have become excessively politicized. And, as President Jair Bolsonaro has openly used his power to name two Supreme Court justices in the next two years as a carrot, it leads to suspicions that judges are using their courts to audition for the top job in Brazilian law. The fact that prosecutors and judges often praise Mr. Bolsonaro and bash his opponents on social media only adds to the suspicions.</p> <ul><li>The STJ&#8217;s former presiding justice granted house arrest benefits to Fabrício Queiroz, a longtime friend of the president who is believed to have run a money-laundering scheme within the office of Senator Flávio Bolsonaro — the president&#8217;s son. He remained at large for over one year&nbsp;—&nbsp;which would disqualify him from receiving said benefits under normal circumstances.</li><li>Just two days before Mr. Witzel was suspended, Brazil&#8217;s top prosecutor issued a recommendation that Senator Flávio Bolsonaro should be granted parliamentary immunity in the money-laundering probe, despite the case not meeting the criteria to do so.</li></ul> <p><strong>Witzel v. Bolsonaro.</strong> Elected on Mr. Bolsonaro&#8217;s coattails, Mr. Witzel quickly became a sworn enemy of the president&#8217;s, openly vying for the top job himself in 2022. One accuses the other of using their power to direct law enforcement against adversaries. Speaking on Friday about the judicial decision, Mr. Witzel said he is being suspended because Mr. Bolsonaro reportedly wants to influence the appointment of the next Rio top prosecutor —&nbsp;a decision typically made by the sitting governor.</p> <p><strong>Flipside.</strong> Judges and prosecutors are not the only ones to blame for the political contamination of the court system. Political parties also have become trigger-happy in filing lawsuits to settle disputes that should remain in congressional spheres.</p> <hr class="wp-block-separator"/> <h2>BREAKING: A mega operation against Brazil&#8217;s most powerful drug gang</h2> <figure class="wp-block-image size-large"><img loading="lazy" width="984" height="656" src="https://brazilian.report/wp-content/uploads/2020/08/pcc.jpeg" alt="pcc federal police operation" class="wp-image-48752" srcset="https://brazilian.report/wp-content/uploads/2020/08/pcc.jpeg 984w, https://brazilian.report/wp-content/uploads/2020/08/pcc-300x200.jpeg 300w, https://brazilian.report/wp-content/uploads/2020/08/pcc-768x512.jpeg 768w, https://brazilian.report/wp-content/uploads/2020/08/pcc-610x407.jpeg 610w, https://brazilian.report/wp-content/uploads/2020/08/pcc-600x400.jpeg 600w" sizes="(max-width: 984px) 100vw, 984px" /><figcaption>Photo: Justice and Security Secretary of Minas/SSP-MG</figcaption></figure> <p>Brazil&#8217;s Federal Police has launched a mega operation this morning against the First Command of the Capital (PCC), a drug gang that emerged in São Paulo in the early 1990s and became the country&#8217;s best-structured organized crime group.</p> <ul><li>Courts have frozen around BRL 252 million (USD 47 million) in assets and have issued over 600 arrest and search and seizure warrants against people linked to the group. The operation is being carried out in 20 of Brazil&#8217;s 27 states and over 1,000 law enforcement agents have been mobilized.</li><li>According to the police, 210 people currently incarcerated continuously received monthly stipends from the group for having occupied high-ranking positions within the criminal organization. The payments were made through individuals not connected to the PCC, in order to make them difficult to trace.</li></ul> <p><strong>Why it matters.</strong> Today&#8217;s operation is one in a series of moves by law enforcement against the PCC.</p> <p><strong>The PCC.</strong> Brazil&#8217;s best-organized criminal group began as a prisoners&#8217; union in the aftermath of the 1992 Carandiru massacre, when 111 inmates were slaughtered in just 30 minutes by police after a riot.</p> <ul><li>Few Brazilians knew about the group’s existence until May 12, 2006, when the PCC staged a series of attacks against police forces. This violence came in response to the state government&#8217;s transfer of 765 inmates – including the PCC’s alleged leader – to a maximum-security prison. On the following day, violent attacks were carried out outside of prisons, as 59 police officers were murdered in a total of 293 attacks.</li><li>Twenty-five years after its creation, the organization now has over 30,000 members spread across nearly every Brazilian state. According to some estimates, the PCC has an annual turnover of between BRL 400 million (USD 106 million) and BRL 800 million. The lower estimate is double what the gang was believed to have earned in 2015. If the PCC were a corporation, it would be among the wealthiest 500 companies in the country.</li></ul> <p><strong>How the group manages its finances.</strong> PCC members who are not in prison must pay a BRL 950 monthly membership fee, nicknamed a “cebola” (onion). Inmates must pay “union dues” ranging from BRL 100 to 600. If a prisoner is unable to pay, he goes into debt and must repay the organization once he is released from jail – usually by committing crimes.</p> <ul><li>The group has yet to make the full transition to a mafia-like organization, with a series of legitimate businesses to operate as a front for illegal operations. Today, though, most of the group’s transactions remain in cash.</li></ul> <iframe src="https://open.spotify.com/embed-podcast/episode/3ZuCR9daYvlPNg868rpzI4" width="100%" height="232" frameborder="0" allowtransparency="true" allow="encrypted-media"></iframe> <hr class="wp-block-separator"/> <h2>Markets</h2> <p>The deadline for Gol Airlines to pay a USD 300-million loan guaranteed by Delta Air Lines expires today. Ratings agencies, however, say default is likely. “Gol is facing constant cash burn without refinancing possibilities,” said Amalia Bulacios, of S&amp;P, which rates Gol&#8217;s debt as CCC-. According to calculations by <a href="https://www.reuters.com/article/us-delta-gol-debt-analysis/delta-facing-its-own-troubles-may-have-to-repay-300-million-on-behalf-of-brazils-gol-idUSKBN25N1BG">Reuters</a> based on Gol&#8217;s cash flow, cash equivalents, and liquid investments, Brazil&#8217;s biggest airline could have just USD 285 million left in the bank.</p> <hr class="wp-block-separator"/> <h2>Government benefits: the pandemic effect</h2> <p>The number of Brazilians in vulnerable situations and depending on government-issued benefits has quadrupled in 2020 —&nbsp;from 20.5 to 85.3 million from last year. In 2019, 10.8 percent of the population got money from the government, a rate that jumped to nearly 45 percent after the pandemic struck. In 25 of 27 states, there are more people getting the coronavirus emergency salary than there are formally employed workers.</p> <div class="flourish-embed flourish-chart" data-src="visualisation/3617482"><script src="https://public.flourish.studio/resources/embed.js"></script></div> <div class="flourish-embed flourish-map" data-src="visualisation/3617532"><script src="https://public.flourish.studio/resources/embed.js"></script></div> <hr class="wp-block-separator"/> <h2>Looking ahead</h2> <ul><li><strong>2021 budget.</strong> The government must present its proposal for <a href="https://brazilian.report/power/2020/08/19/brazil-2021-budget-can-belt-get-any-tighter/">next year&#8217;s budget</a> by the end of today. With the need for beefed-up aid programs, ministries are <a href="https://brazilian.report/power/2020/08/10/budget-who-controls-the-purse-strings-in-the-brazilian-government/">battling</a> not to have their funds cut and reallocated. On Friday, Environment Minister Ricardo Salles pulled a bold move, announcing he was halting all <a href="https://brazilian.report/podcast/2020/07/16/explaining-brazil-podcast-deforestation-is-bad-for-business/">actions against deforestation</a> in the Amazon and Pantanal due to a lack of funds —&nbsp;which naturally generated an image crisis, and prompted Vice President Hamilton Mourão to publicly state that the money wouldn&#8217;t be cut. But not all other cabinet members will be able to pull such maneuvers.</li><li><strong>GDP.</strong> Brazil is set to publish its official <a href="https://brazilian.report/newsletters/brazil-daily/2020/08/26/what-to-expect-from-brazil-q2-2020-gdp-numbers/">Q2 GDP figures</a> on September 1. We already know that the drop will be significant, as economic activity was halted for much of the quarter. According to most financial institutions’ projections, the quarterly drop will be somewhere between 8 and 10 percent. If projections are confirmed, it means that the Brazilian economy will regress to levels recorded in Q3 2009 — meaning that the pandemic has scrapped 11 years of (feeble) growth.</li><li><strong>Emergency salary. </strong>President Jair Bolsonaro is expected to officially announce the extension of the coronavirus emergency salary on Tuesday. The BRL 600 (USD 111) payments were <a href="https://brazilian.report/power/2020/08/20/what-happens-when-brazils-coronavirus-emergency-aid-ends/">set to expire this month</a>, but the president said he wants to maintain the program at least until the end of the year to help voters cope with the economic crisis. The value of future handouts is unknown —&nbsp;the current monthly price tag (BRL 50 million) is untenable, but Mr. Bolsonaro said the Economy Ministry&#8217;s BRL 200-per-person proposal is not good enough.</li><li><strong>Elections. </strong>Starting today, parties are allowed to hold their conventions and choose their candidates for the November municipal elections. Due to the pandemic, campaigns will <a href="https://brazilian.report/podcast/2020/06/18/covid-19-pandemic-brazilian-elections-more-exposed-fake-news/">predominantly happen on social media</a> and by way of TV and radio ads. This year brings a completely different context from the 2016 race, with a weakened Workers&#8217; Party not well-placed in any of the biggest stages, namely São Paulo and Rio de Janeiro.</li></ul> <hr class="wp-block-separator"/> <h2>In case you missed it</h2> <ul><li><strong>Coronavirus. </strong>Brazil has so far registered 3.8 million coronavirus cases and 120,828 deaths. However, the 7-day rolling average of new daily deaths is now at 875 — still one of the highest in the world, but the lowest for the country since May 21. However, as <strong>The Brazilian Report</strong> showed on multiple occasions, the pandemic has <a href="https://brazilian.report/society/2020/08/27/six-months-on-brazils-coronavirus-situation-in-charts/">progressed unevenly</a> in a country that is as large and unequal as Brazil.&nbsp;</li><li><strong>Trade. </strong>The Mercosur-EU trade deal has lost its main advocate on the European side, with the resignation of Ireland&#8217;s Phil Hogan as the EU trade commissioner. Mr. Hogan stepped down after being accused of breaching Covid-19 guidelines during a trip to his home country Ireland. Climate Action Network (CAN) Europe said the Mercosur deal could be ‘<a href="https://brazilian.report/newsletters/brazil-daily/2020/08/28/rio-governor-suspended-in-coronavirus-corruption-probe/">put on ice</a>’ by the European Commission.</li><li><strong>5G.</strong> According to estimates from Ericsson, the implementation of 5G networks in Brazil will generate investments of around BRL 9.2 billion from telecom companies until 2025. The company also discusses the creation of 205,000 direct jobs and an increase of up to 2.4 percent in the Brazilian GDP. Of course, Ericsson is not an unbiased observer, being a 5G provider itself.</li><li><strong>Argentina.</strong> After almost six months of lockdown due to the coronavirus, bars and restaurants in Buenos Aires are reopening today, though with heavy restrictions such as no indoor seating and no more than four people per table. President Alberto Fernández announced last week that the quarantine would be extended until September 20 but groups of up to ten people would be allowed to meet outdoors in Argentina.

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