A rock and a hard place: Bolsonaro to choose between Moro and Congress in Coaf row

. May 01, 2019
A rock and a hard place: Bolsonaro to choose between Moro and Congress in Coaf row President Bolsonaro and Justice Minister Sergio Moro (R)

When he invited Sergio Moro to be his Justice and Security Minister, Jair Bolsonaro was aware he was taking a risk. While Mr. Moro has his critics, the former Operation Car Wash judge is undeniably one of the most popular figures in Brazil right now and remains the face of anti-corruption in the country. By bringing Mr. Moro into his cabinet, the Bolsonaro administration gained an automatic boost in prestige and credibility.

However, what happens when the president makes a decision that isn’t to Mr. Moro’s liking? Does the Justice Minister have enough popular clout to force Jair Bolsonaro’s hand? The latest developments within the administration could give us a clue as to where this balance of power stands.

</span></p> <p><span style="font-weight: 400;">The imbroglio concerns Brazil&#8217;s money laundering enforcement council, Coaf, which was brought under the purview of Sergio Moro&#8217;s Justice Ministry at the beginning of the year. However, members of Congress are maneuvering to cancel this change, putting Coaf back under the umbrella of the Economy Ministry, claiming that <a href="https://www.oantagonista.com/brasil/moro-sem-o-arsenal-do-coaf/">too much power has been concentrated</a> in the hands of the Justice Ministry, ergo, in the hands of Mr. Moro.</span></p> <p><span style="font-weight: 400;">Congress is considering this change as part of its debates on the government decree which instituted Jair Bolsonaro&#8217;s cabinet reshuffle in January. The administration&#8217;s structure has until next month to be approved, with members of Congress able to promote amendments to Mr. Bolsonaro&#8217;s new cabinet format.</span></p> <p><span style="font-weight: 400;">While the arguments to give Coaf back to the Economy Ministry are predominantly based on the claim that Sergio Moro has been given too many powers, there is a segment of members of Congress behind this push who have found themselves under the Coaf&#8217;s microscope.</span></p> <h2>Coaf in the spotlight</h2> <p><span style="font-weight: 400;">Above all, Coaf is not an investigatory body. It simply gathers financial information from banks and companies from the luxury goods sector and produces reports based on banking activity that it considers to be suspicious.</span></p> <p><span style="font-weight: 400;">This information is then passed on to the authorities, namely the Federal Police or Federal Prosecution Service, which decide whether to take the case any further. Both of these agencies come under the purview of the Justice Ministry, fueling arguments for and against moving Coaf back to the Ministry of the Economy. On the one hand, having Coaf under the same umbrella as the Federal Police and Prosecution Service could lead to greater efficiency; on the other, it could represent an accumulation of powers under one ministry.</span></p> <p><span style="font-weight: 400;">Coaf has gained a certain prominence in the last six months, thanks to a December report from the agency which highlighted suspicious financial transactions involving Fabrício Queiroz, a former advisor of Jair Bolsonaro&#8217;s son, Senator Flávio Bolsonaro, in his previous post as a state lawmaker in Rio de Janeiro.</span></p> <p><span style="font-weight: 400;">Mr. Queiroz transferred a total of BRL 1.2 million throughout 2016, which did not correspond with the salary he received working for Mr. Bolsonaro. What&#8217;s more, Coaf found a number of cash withdrawals which corresponded to deposits made almost simultaneously, as well as a BRL 24,000 check made out to the First Lady, Michelle Bolsonaro.</span></p> <p><span style="font-weight: 400;">This led prosecutors in Rio de Janeiro to launch an investigation into <a href="https://brazilian.report/power/2019/01/18/flavio-bolsonaro-scandal-president/">Flávio Bolsonaro</a> and over a dozen other lawmakers in the state, suspected of operating a scheme to embezzle part of the salaries received by cabinet advisors. However, the case is operating under secrecy, and no developments have been disclosed since January 3.</span></p> <h2>Moro won&#8217;t let go</h2> <p><span style="font-weight: 400;">In a bid to appease Congress and gain enough support to approve his governmental restructuring decree, President Jair Bolsonaro is reportedly considering giving Coaf back to the Economy Ministry.</span></p> <p><span style="font-weight: 400;">Sergio Moro did not like this one bit and took to social media to argue in favor of keeping the agency where it is, challenging the president. This led government spokesperson Otávio Rêgo Barros to declare that Mr. Bolsonaro&#8217;s &#8220;personal preference&#8221; is to keep Coaf as part of the Justice Ministry, but that studies are ongoing.</span></p> <p><span style="font-weight: 400;">However, regardless of the government&#8217;s position on the matter, congressional leaders have threatened to force through the change themselves, claiming they have the numbers to do so. Arthur Lira, of the center-right Progressistas party, declared that &#8220;the matter of Coaf only hasn&#8217;t been resolved because it hasn&#8217;t been voted on yet.&#8221;</span></p> <p><span style="font-weight: 400;">Were the government not to receive enough support to vote on the decree by June, it would mean that his entire cabinet restructuring would be scrapped, reverting to the ministerial set-up used by the Michel Temer government, with the re-creation of the Ministries of Cities, Culture, Sport, and Labor, among others.</span></p> <p><span style="font-weight: 400;">Besides Coaf, members of Congress are also orchestrating a push to bring back the Public Security Ministry, which was merged into the Justice Ministry and, not coincidentally, is currently overseen by Sergio Moro. This move would severely deplete Mr. Moro&#8217;s powers, and is seen as being a direct message to the Justice Minister. Whereas transferring the control of Coaf is based on technical arguments, recreating the Public Security Ministry is a direct attack on Mr. Moro&#8217;s influence.

Euan Marshall

Euan Marshall. Originally from Scotland, Euan Marshall is a journalist who ditched his kilt and bagpipes for a caipirinha and a football in 2011, when he traded Glasgow for São Paulo. Specializing in Brazilian soccer, politics and the connection between the two, he authored a comprehensive history of Brazilian soccer entitled “A to Zico: An Alphabet of Brazilian Football.”

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