Preventing Systemic Corruption in Brazil

Sérgio Fernando Moro

Abstract: This essay describes the Brazilian anticorruption operation known as Operação Lava Jato
(“Operation Car Wash”), its findings, and its results based on cases tried up to March 2018. Told from
the perspective of the federal judge of the Thirteenth Federal Criminal Court of Curitiba, in whose court
most of the Lava Jato cases have been prosecuted, this massive criminal case offers lessons that may be
useful to other anticorruption efforts. Preventing systemic corruption is a challenge, but it is a necessary
step for the improvement of democracy.

What began as an investigation of an isolated in-

stance of corruption within a Brazilian oil compa-
ny expanded into an immense anticorruption oper-
ation known as Operação Lava Jato (“Operation Car
Wash”). This investigative operation has penetrat-
ed deep within Brazil’s government and corporate
elite to root out systemic state-sanctioned corrup-
tion. Its criminal cases also appear to be instating
new legal norms for how corruption cases are han-
dled in Brazil, giving citizens hope that Lava Jato’s
impact will be felt far into the future. How Brazilian
prosecutors and courts dealt with this immense anti-
corruption effort may provide important lessons for
the battle against systemic corruption both in Bra-
zil and elsewhere. This essay provides a comprehen-
sive account of Lava Jato and its significance for Bra-
zil going forward.

It is important to note from the beginning that Lava
Jato is not a single criminal case but several, in which
federal prosecutors have decided to pursue separate
charges against many defendants. So far, more than
sixty criminal cases have been brought against about
289 defendants in Brazilian federal courts.1 About
thirty-three of those cases have already been tried,
resulting in convictions of bribery and money laun-
dering for about 157 people. The reflections I offer in

sÉrgio fernando moro is
a Federal Judge of the Thirteenth
Federal Criminal Court of Curi-
tiba, Brazil. He is also Professor
of Procedure Criminal Law at the
Unicuritiba–Centro Universitário
Curitiba. He presided over the trial
of many bribery cases in Operação
Lava Jato.

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157

this essay are based on the cases that have
been tried at the time of writing. I do not an-
alyze or comment upon cases that have yet
to be tried or that are awaiting sentences.

At the core of the Lava Jato cases are
crimes connected to contracts with Petroleo
Brasileiro s/a (Petrobras). Petrobras is a
semipublic, majority state-owned Brazil-
ian company engaged primarily in oil and
gas exploration, refining, and transporta-
tion. It is Brazil’s largest company and one
of the world’s major oil and gas companies.
It was founded in 1953 to explore Brazilian
oil and gas fields with the goal of transform-
ing Brazil into a self-sufficient producer of
petroleum products.

As the cases already tried reveal, multi-
ple bribes were paid in contracts between
Petrobras and its suppliers; these bribes
were used for the criminal enrichment of
Petrobras executives and politicians, as
well as to finance electoral campaigns. Be-
fore describing what prompted the inves-
tigation and how it unfolded, however, it
is important to provide some context, in-
cluding some details concerning Brazilian
criminal justice.2
White-collar crimes like bribery and

money laundering represent a challenge
for law-enforcement agencies all over the
world. They are often difficult to discover,
to prove, and to punish. Such crimes are
usually committed in secret, by powerful
people, and with some degree of sophistica-
tion. And police, prosecutors, and the judi-
ciary are often not well prepared for the in-
vestigation, prosecution, and judgment of
these highly sophisticated crimes. Some-
times powerful defendants also exploit the
gaps in the criminal law and of the judicial
system to prevent effective accountability.
Some countries are more successful than
others in enforcing the law against these
kinds of crimes. Brazil, at least prior to Lava
Jato, did not have a strong tradition of en-
forcing the law against crimes committed

by powerful politicians or businessmen.
There are likely two main reasons for this.
The first is the slow pace at which the
judicial process progresses in Brazil. Un-
til recently, the enforcement of a criminal
conviction was possible only after the case
reached a final decision that could no longer
be appealed. Enforcement of a criminal sen-
tence depended on the judgment of the last
appeal. Only then would the case be seen as
transitado em julgado, or tried with no possi-
bility of appeal. Years might pass between
an initial judgment and the final sentence.
This rule emerged from a 2008 Supreme
Court decision regarding a controversial
interpretation of the presumption of inno-
cence in Brazil’s Constitution.3 Theoretical-
ly, enforcing this rule would not be a prob-
lem, but because of a generous system of
appeals and the heavy caseload of Brazilian
Superior Courts, powerful defendants used
it to manipulate the judicial process, initi-
ating endless appeal proceedings to prevent
their cases from ever reaching a conclusion
and effectively avoiding accountability.4

Until recently, it was very common for
no final decision to ever be reached in
complex criminal cases involving power-
ful individuals. Even cases with strong evi-
dence of criminal behavior or cases involv-
ing very serious crimes never reach con-
clusions in Brazil. As a rule, wealthy and
well-connected defendants in these cas-
es never go to prison, despite compelling
evidence of their guilt. However, this rule
changed recently, as I will explain below.
The second main reason for criminal im-
punity among the powerful is the fact that
the Supreme Court of Brazil has original
jurisdiction over criminal charges against
high federal official authorities, including
the president, vice president, cabinet min-
isters, and members of the federal Con-
gress. This is ensured by a controversial
provision in Brazilian law stating that high
politicians and authorities in criminal cas-
es must have foro privilegiado (“privileged

158

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Dædalus, the Journal of the American Academy of Arts & SciencesPreventing Systemic Corruption in Brazil

forum”). So if, for example, a criminal in-
vestigation in a lower court produces evi-
dence of criminal conduct by a federal con-
gressman, the judge must immediately send
the case to the Supreme Court. However, as
mentioned, the Brazilian Supreme Court’s
heavy caseload (its docket contained over
fifty-five thousand cases in the last year
alone) makes it very difficult to adjudicate
criminal charges in a timely fashion. Conse-
quently, cases involving crimes committed
by powerful defendants sometimes literal-
ly never end. In practice, the special juris-
diction of the Supreme Court over crimi-
nal charges involving high-ranking official
authorities worked as a shield against ac-
countability.

These are two primary structural reasons
(though there are others) why law enforce-
ment is so weak on crimes committed by
powerful defendants in Brazil. The weak en-
forcement of the law against white-collar
crimes is one of the likely reasons for the
development of systemic corruption in Bra-
zil. However, legal procedures have recent-
ly changed the system for the better, at least
in part. Lava Jato is not alone, but rather is
part of this broader effort.

Criminal Case 470, decided by the Brazil-

ian Supreme Court in 2012, began to change
the norm of weak enforcement of the law
against white-collar crimes in Brazil.

In this case, also known as Mensalão
(“monthly,” because the case involved
monthly bribes to some congressmen),
the Supreme Court convicted several highly
placed politicians, including a powerful for-
mer minister of the federal government and
several congressmen, political leaders, po-
litical party operatives, and bank directors,
of bribery and money laundering.5 In this
case, it was proven that the chief minister of
the Brazilian federal government between
2002 and 2005 organized a bribery scheme
to obtain political support from congress-
men for federal legislative initiatives.

The charges were presented before the
Supreme Court in 2006, though it took un-
til 2012 for the case to go to trial. There was a
great deal of skepticism about the Supreme
Court’s judgment, especially about wheth-
er it would try the case in a reasonable time
and convict the defendants. But in the end,
the Supreme Court issued a guilty verdict
for most of the defendants, including sev-
eral powerful politicians. Of course, Bra-
zilian courts had produced some convic-
tions for white-collar criminals in the past.
But these were the exception, not the rule,
and none of them was as important or rel-
evant as the decision in Criminal Case 470.
These verdicts marked a clear break with
the norm of weak enforcement of the law
against white-collar or financial crimes. A
Supreme Court decision has great influence
across the whole judicial system. Beyond
the importance of the criminal cases’ direct
consequences, they worked as an example
for all Brazilian law enforcement agencies
and judges, showing that the shield against
effective accountability for powerful defen-
dants could be broken.

Two years after the judgment in Crimi-

nal Case 470, Operação Lava Jato began.
As usually happens with criminal investi-
gations, Lava Jato started small. The fed-
eral police opened an investigation tar-
geting four individuals involved in what
seemed at the time to be a money-laun-
dering scheme involving black-market
money exchanges. One of these individu-
als, professional money launderer Alberto
Youssef, was connected to a former direc-
tor of Petrobras, Paulo Roberto Costa. The
investigation revealed that Youssef had
bought a luxury car for Costa, concealing
the origin of the resources used.

This evidence led the federal police,
working with judicial search-and-seizure
warrants, to raid the offices and houses of
Youssef and Costa in March 2014. During
this process, Costa tried to destroy and hide

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147 (3) Summer 2018Sérgio Fernando Moro

paper evidence and consequently was placed
into pretrial detention. Youssef was also ar-
rested on a pretrial detention order due to
his status as a recidivist career criminal.

Looking at the banking records of Yous-
sef’s front companies, police and prosecu-
tors discovered that his accounts had re-
ceived millions of reais in credits from some
of the biggest Brazilian construction com-
panies, which also happened to be some of
Petrobras’s major suppliers. In another line
of the investigation, it was discovered with
the assistance of Swiss authorities that Costa
had hidden millions of dollars in offshore
accounts. Facing long prison terms, Alberto
Youssef and Paulo Costa agreed in the sec-
ond half of 2014 to conclude plea agree-
ments with the prosecutors.

Youssef and Costa revealed that, as a rule,
every contract Petrobras signed with the
major Brazilian construction companies
included kickbacks of 1 or 2 percent of the
total value of the contract to the Petrobras
officials who approved it. Youssef’s role was
to organize the money laundering scheme.
Costa received a share of the bribes to work
for the interests of the construction com-
panies. Another share of the money went
to politicians, including federal legislators
of the Progressive Party (Partido Progres-
sista), which was part of the ruling coali-
tion and was in practice responsible for
the nomination of Costa for his position at
Petrobras.

Youssef and Costa testified that other
Petrobras officials had received bribes and
had worked with intermediaries and politi-
cians from other parties in the governing co-
alition, such as the Workers’ Party (Partido
dos Trabalhadores) and the Party of the Bra-
zilian Democratic Movement (Partido do
Movimento Democrático Brasileiro). They
also revealed that the Brazilian construc-
tion companies who paid the bribes were
fixing Petrobras’s bidding-process out-
comes. Petrobras’s major suppliers decid-
ed in advance which among them would

win each bidding process, and the chosen
company could then offer a price proposi-
tion without real competition. They called
themselves “The Club.”

The investigations continued to produce
new evidence based in part on plea agree-
ments with other cooperating criminals. Of
course, everything a cooperating criminal
says has to be supported by additional evi-
dence. For this reason, many investigations
are still ongoing. But it has been possible
in some cases thus far to obtain evidence
that corroborates information revealed by
cooperating criminals. There have been
about twenty-eight criminal convictions
and sentences specifically related to brib-
ery in Petrobras contracts as a result of the
Lava Jato cases tried up to March 2018. Con-
victions reached top executives of the big-
gest Brazilian construction companies act-
ing as corruptors; top executives of Petro-
bras acting as facilitators and beneficiaries
of bribes or kickbacks; and intermediaries
between these two groups.

So far, four former directors of Petrobras
have been convicted and sentenced to pris-
on terms. Two of them decided, after serv-
ing part of their prison sentences, to coop-
erate with authorities. The police and pros-
ecutors discovered that all four had millions
of dollars or euros in bribes hidden in off-
shore accounts in countries such as Switzer-
land, Monaco, and Luxembourg. A Petro-
bras ceo was also convicted for taking
bribes and money laundering.

At least six trials ended in convictions
for former federal legislators who had re-
ceived bribes in the Petrobras scandal. In
four other cases, the Court found that mon-
ey from bribes had been directed to finance
illicitly a political party. Two of the former
lawmakers convicted in the Lava Jato cas-
es had also been involved in Criminal Case
470 (Mensalão). Amazingly, they contin-
ued to accept illegal payments from Petro-
bras even as the Mensalão trial was under
way in the Brazilian Supreme Court.

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These behaviors, which may appear ab-
surd, are indicative of the impunity many
corrupt officials enjoyed. In another exam-
ple, in 2014, Congress created a special in-
vestigation commission for the Petrobras
scandal. A senator was nominated as vice
president of the commission. Instead of do-
ing the investigation, he took the opportu-
nity to request bribes from top executives
of the biggest construction firms then un-
der investigation so that they might avoid
scrutiny. For this, the senator was eventual-
ly convicted of taking bribes himself.

Even a former Speaker of the House of
Representatives was implicated in the scan-
dal and was convicted. Again with the as-
sistance of Swiss authorities, it was discov-
ered that he had received about $1.5 million in bribes, which were deposited in offshore accounts in a Swiss Bank. A former gover- nor of the state of Rio de Janeiro, a former secretary of finance of the federal govern- ment, and even a former president of Bra- zil were also convicted for receiving a share of bribes in Petrobras’s contracts.6 So far, dozens of executives from eleven of Brazil’s largest construction companies have been convicted as bribe givers. To illustrate the magnitude of these cor- rupt practices, a manager at Petrobras, after reaching a plea agreement with the author- ities, agreed to return nearly $97 million in
bribes that he had received from Petrobras
contracts and kept in secret bank accounts
abroad. In the beginning of the investiga-
tion, Petrobras assumed a posture of gen-
eral denial, refusing to admit any problem
of governance publicly. As the investigation
developed, however, the company gradual-
ly began to admit that crimes were commit-
ted, culminating in an official recognition
in Petrobras’s 2015 annual report to share-
holders of losses from corruption of nearly
6 billion reais (about $1.9 billion). It took time, but some of the construc- tion companies involved in the scheme also began to admit responsibility. Three of the largest companies–Camargo Cor- rea, Andrade Gutierrez, and Odebrecht– reached leniency deals with the prosecu- tors. In exchange for lighter punishments, they agreed to reveal illicit acts, abandon criminal practices, implement efficient systems of compliance, and compensate public coffers by returning billions of reais. One of them also revealed that it paid bribes for public employees abroad, in countries like Peru, Argentina, and Mexico, among others. The cases already tried reveal that the payment of bribes on Petrobras’s contracts was not an exception but, rather, the rule. Some of the cooperating criminals used that very word, describing the crimes they committed as simply “a rule of the game in contracts of the public sector.” Some al- leged that this illicit practice went beyond Petrobras and was used by other state- owned companies and in other branches of the federal government. Investigations are ongoing not only in the Federal Criminal Court of Curitiba, where the investigation started, but in other Brazilian federal courts that were as- signed responsibility for trying certain Lava Jato cases. Because of foro privilegiado, doz- ens of highly placed politicians, especial- ly congressmen, are being investigated by the chief federal prosecutor before the Su- preme Court. In spite of the Court’s heavy caseload, some of these high-profile defen- dants have been charged already. The cases already sentenced suggest that an environment of systemic corruption was uncovered by the investigation. The pay- ment of bribes was taken for granted in Petrobras’s contracts; participants knew even before signing contracts that bribes would be paid, just like the construction companies knew in advance whose “turn” it was to win the contract, irrespective of the formal bidding process. They also knew that the bribes would be shared between l D o w n o a d e d f r o m h t t p : / / d i r e c t . m i t . / e d u d a e d a r t i c e – p d / l f / / / / 1 4 7 3 1 5 7 1 8 3 1 1 2 0 d a e d _ a _ 0 0 5 0 8 p d / . f b y g u e s t t o n 0 7 S e p e m b e r 2 0 2 3 161 147 (3) Summer 2018Sérgio Fernando Moro Petrobras executives and the federal pol- iticians who gave them political support. There were even fixed rules to calculate the amount of the bribes: generally 1 or 2 per- cent of the total value of the contract. Corruption, as an isolated crime, exists all around the world. But systemic corrup- tion–the payment of bribes as a rule of the game–is not as common, and represents a severe degeneration in the functioning of the public and private spheres, especially in democratic nations.7 The costs of sys- temic corruption are enormous. First, the cost of the bribes is usually added by the offending company to their contracts with state-owned companies or with the govern- ment, affecting public budgets. If the pay- ment of such bribes is not an isolated prac- tice but a general rule, the management of public resources is severely affected. More- over, the need to generate funds for bribes in systemic corruption schemes can affect investment decisions by public and private entities. Some of Petrobras’s bad investments may not be simply explained as a result of a bad judgment or unlucky bet, but instead as a deliberate choice by the corrupt directors of Brazil’s largest enterprise to generate bribes rather than to make the best decision from an economic point of view. One example is the construction of the new Abreu e Lima refinery.8 Initially, Petrobras estimated the cost of the project at $2.4 billion. Howev-
er, by 2015, Petrobras had already wasted
$18.5 billion on the construction of the re- finery, and it was only partially complete. Even if the refinery operated with full ef- ficiency for the rest of its planned life, it would incur a loss of $3.2 billion. Lava Jato
cases have shown that bribes were paid in
some construction contracts for the refin-
ery. But the difference between $2.4 billion and $18.5 billion cannot be explained only
by the additional costs of the bribes. Bad
investment decisions were made because
Petrobras executives were more concerned

with receiving kickbacks than doing their
job in the company’s best interests.

Another detrimental effect of systemic
corruption is that it chases away local and
foreign investors. If the market is not clean
and transparent and if bribes and cheat-
ing are the rule, responsible investors will
not have the confidence to put their money
into that market. But above all, systemic cor-
ruption is damaging because it undermines
confidence in the rule of law and in democ-
racy. If the law does not apply to everyone
and if crime and cheating are the norm, trust
in democracy will progressively erode.

Faced with the revelation of systemic cor-

ruption, what should be done? First, the ju-
dicial system must work. Crimes that are
uncovered and proven through due legal
process must be punished. Justice works
when the innocent defendant goes home
and the guilty defendant goes to prison, ir-
respective of their economic or political
status. There is still much to be done to ad-
vance this concept in Brazil, yet Criminal
Case 470 and Lava Jato, like other recent cas-
es in Brazil, reveal that much can be done
even within the current legal system, as long
as allegations are dealt with seriously.9 Jus-
tice must be more than actors playing their
parts in cases that never end with perpetra-
tors who are never punished.

The adequate functioning of the crimi-
nal justice system is a necessary, though in-
sufficient condition for the elimination of
systemic corruption. It is imperative that
other public institutions, like the executive
and legislative branches of government,
adopt public policies aimed at preventing
and combating corruption as well. System-
ic corruption is not and cannot be a prob-
lem only for the judicial branch.

The government is the principal actor re-
sponsible for creating a political and eco-
nomic environment free of systemic cor-
ruption. Through its visibility and power,
the government can lead by example. Better

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laws can improve the efficiency of the crim-
inal justice system and increase the trans-
parency and predictability of relations be-
tween the public and private sectors, reduc-
ing incentives and opportunities for corrupt
practices.

Another important step would be the sig-
nificant reduction of party patronage in the
civil service. The influence of party politi-
cians in the recruitment of executives in
state-owned companies, and other high
positions in the state bureaucracy, is what
made the criminal scheme at Petrobras pos-
sible. Based on cases tried and sentenced
thus far, it seems that Petrobras executives
were appointed with a mission: to obtain fi-
nancial resources from suppliers for the il-
licit enrichment of politicians or the illegal
financing of electoral campaigns. Reducing
political influence in state-owned compa-
nies would help to prevent this evil.

Freedom of the press and access to in-
formation are also essential. For citizens
to have meaningful checks on those who
govern, they must be well informed about
the management of public life.

Everything to do with the Lava Jato cases,
from the prosecution, evidence, and hear-
ing of witnesses to the judgment and sen-
tencing, has been conducted openly and in
the light of day. The Brazilian Constitution
requires that the judicial process be open
to public scrutiny. There is no possibility
of having cases prosecuted and tried in se-
cret. This rule of transparency was very im-
portant for the Lava Jato cases. Making ev-
ery piece of evidence public was crucial for
gaining the popular support necessary for
the enforcement of the law, and helped pre-
empt attempts by powerful defendants to
obstruct justice.

In fighting systemic corruption, the pri-
vate sector also plays a part. Corruption
involves those who make illicit payments
and those who receive them. Both parties
are guilty. Companies must therefore do
their homework, denouncing requests

or demands for bribes, as well as imple-
menting mechanisms of internal control
and accountability that make it difficult
or impossible to pay or receive them. It is
also important for private-sector actors
to work collectively so that companies in-
volved in corrupt practices are identified
and isolated from the market and not al-
lowed to assume a preeminent position.
An outstanding example of this kind of
private-sector responsibility can be found
in Sicily, where businesses have joined to-
gether in associations like Addiopizzo, or
“goodbye pizzo,” to collectively refuse to
pay mafia money (pizzo).10 Acting togeth-
er, they have more power to refuse to pay
extortion money and to avoid retaliation
from organized crime. Their slogan is “a
whole people who pays pizzo is a people
without dignity.” Collective mobilization
on the part of private companies could be
used to good effect in Brazil, with some sit-
uation-specific modifications.

It is also important to keep in mind that
systemic corruption is a product of insti-
tutional and cultural weaknesses. System-
ic corruption is not a natural phenomenon,
and no country is destined to live with it.
Even if discovering and exposing corrup-
tion generates new challenges and painful
resistance in the short run, these effects
are part of the cure. Once systemic cor-
ruption is discovered, necessary public pol-
icies should be adopted and implemented
to overcome it. The problem cannot be re-
solved by sweeping it under the rug.

Because of the dimension of the crimes

that have been uncovered, Lava Jato perhaps
more than any other case provides Brazil
with a golden opportunity to take the neces-
sary steps to overcome this shameful prac-
tice. It is difficult to predict at this stage
whether that will happen, whether cor-
ruption will be contained and reduced to
more reasonable proportions, or whether
Brazil will return to the pre–Lava Jato lev-

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els of corruption. Some backlash and crit-
icism against Lava Jato has arisen (espe-
cially from politicians and corporations
involved), much of it driven by miscon-
ceptions about the nature of the enterprise.
Some critics have complained that the
Lava Jato operation is not impartial and
has been used to “play politics.” But this is
not so. Of course, crimes involving bribes
paid to politicians will inevitably have po-
litical consequences. But they arise outside
the court and beyond the judges’ control.
Others have said that Lava Jato represents
the “criminalization of politics.” The blame
should not, however, be aimed at the judi-
cial process, but rather at the politicians
who committed the crimes. The judicial
process is just a reaction against corruption,
as the justice system cannot turn a blind eye
to crime.

Some critics say that the judiciary has not
respected due process in these cases. How-
ever, every aspect of the judicial process
has been conducted in open court with re-
spect for the rights of the defendants, and
has been based on extensive evidence ob-
tained, processed, and publicized in accor-
dance with the law and the Brazilian con-
stitution. Lava Jato is not a witch hunt. In-
vestigators simply followed the leads from
case to case, uncovering a widespread prob-
lem that mandated numerous convictions
and detentions. Therefore, nobody is be-
ing charged or convicted based on political
opinion. When there is evidence of illegal
conduct, the accused are being charged and
convicted because of the bribery and mon-
ey laundering crimes they committed, not
because of their political allegiances.

Finally, there has been concern about the
use of pretrial detention in the Lava Jato cas-
es. Pretrial detentions should, of course, be
the exception and not the rule in any judi-
cial system. However, a judge in Brazil can
order a pretrial detention if the defendant
presents a danger to other individuals or to
society, or if there is a risk that the defen-

dant will flee or obstruct justice. There are
similar laws in the United States: the U.S.
Criminal Code allows a judge to deny bail
if the defendant is potentially dangerous or
a flight risk.11 The U.S. Supreme Court case
U.S. v. Salerno affirmed that this statute was
constitutional.12

In the Lava Jato cases, pretrial detentions
were ordered only when evidence against
the defendant was particularly strong;
when there was a risk that the defendant
would flee or obstruct justice; or to pre-
vent the defendant from committing new
crimes while awaiting trial. It is impor-
tant to understand that the crimes of the
Petrobras cases were committed in a pro-
fessional and serial manner in a context
of systemic corruption. For example, one
of the companies involved in this crim-
inal network devoted a specific depart-
ment solely to paying bribes, which was
in operation for several years, even during
the investigation. Operations ceased only
when the company’s top executives were
served with pretrial detention orders. Giv-
en the presumption of innocence, pretri-
al detentions should be exceptional; but
the extraordinary nature of systemic cor-
ruption demands strong and urgent mea-
sures by criminal justice to break the vi-
cious circle.13

Other critics have complained about the
extensive use of plea agreements in the Lava
Jato investigation, arguing that prosecutors
and judges are still not being tough enough
on white-collar criminals. However, crimes
like corruption are committed in secret and
usually only the criminals themselves are
witness to their wrongdoing. Therefore, it
is sometimes necessary to make a deal with
a criminal to get evidence to build a case on
more central players. As U.S. Federal Appel-
late Judge Stephen Trott has stated, some-
times such bargains are necessary, because
without them “the big fish go free and all
you get are the minnows.”14 It makes sense
to offer a plea agreement, for example, to a

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criminal responsible for a money launder-
ing scheme in order to get evidence against
bribe takers or bribe givers who are respon-
sible for the national environment of sys-
temic corruption.

Until now, the police, prosecutors, and the

judiciary have been the main protagonists
in Brazil’s fight against systemic corruption.
It is important also to acknowledge the Bra-
zilian Supreme Court, which has handed
down new precedents that strengthen some
anticorruption rules. In a possible collateral
effect of the investigation of the Petrobras
scandal, Brazil’s Supreme Court overruled
the harmful provision I discussed above,
which allowed wealthy defendants to post-
pone indefinitely, through endless appeals,
the execution of a prison sentence.15 In 2016,
the Supreme Court ruled that the enforce-
ment of a criminal conviction is permitted
immediately after a sentence is affirmed by
a court of appeal; it is no longer necessary
to wait several years for a final decision at
the highest level of appeal.

This precedent represents a kind of judi-
cial revolution in the enforcement of crim-
inal law in complex cases in Brazil. Its im-
pact is already visible in several other cas-
es involving corruption. With this new
ruling, Brazil’s Supreme Court has clear-
ly demonstrated that it fully understands
the connection between systemic corrup-
tion and impunity.16

In another important case, Brazil’s Su-
preme Court ruled against the legality of
electoral contributions from companies.17
Brazilian electoral law previously lacked
proper limits on large corporate contribu-
tions to elections. In light of endemic cor-
ruption, the Supreme Court understood
that without safeguards, there would be
a great danger of improper relations be-
tween companies and politicians via quid
pro quo donations. So it ruled such con-
tributions void until proper regulations
could be approved.

Unfortunately, it seems that as of this
writing, the executive and legislative
branches of government have made no such
significant contribution to Brazil’s efforts
against corruption. For example, they could
do so by proposing and approving better
anticorruption laws. One necessary step
would be to change Brazilian electoral law
along the lines of the Supreme Court deci-
sion I describe above. Congress should dis-
cuss proper and strict regulations for elec-
toral contributions from companies. For
example, it could forbid any electoral con-
tributions from companies with govern-
ment contracts and establish low limits for
other corporate donations.

Unfortunately, there are some signs of
reaction against Lava Jato from Congress
itself. In 2016, federal prosecutors present-
ed a bill to improve anticorruption laws.
Despite major popular support for the
measures, the House rejected most of the
reforms, and it is still uncertain whether
the bill will be approved. More disturbing
was an attempt in the House to approve
an amnesty bill for illegal electoral dona-
tions, up to and including bribes. In anoth-
er controversial act, the Senate drafted a
new bill about abuses of power committed
by judges, prosecutors, and police officers.
Of course, official authorities who abuse
their powers should be held accountable;
this, also, is central to a working system of
justice. But the text of the bill was written
such that it could have a cooling effect on
the independence of the judiciary and the
autonomy of the prosecutors and the po-
lice to pursue criminal corruption as they
see fit. As of this writing, the future of this
bill is also uncertain.

It is possible to garner some lessons from

Brazil’s situation. Decades of weak law en-
forcement against crimes committed by
high politicians and powerful business-
men have generated a breeding ground for
bribery, kickbacks, and corruption. Weak

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147 (3) Summer 2018Sérgio Fernando Moro

law enforcement may not be the first cause
of this virulent corruption, but it certain-
ly does not help to constrain it. However,
new realities have presented Brazil with an
opportunity to face systemic corruption, to
confront past failures and set a new course
for the future. The systemic corruption un-
covered in Brazil is shameful. But there is
another way to look at this picture. The ef-
forts of many individual Brazilians to fight
the problem of corruption have brought
these crimes to light. The police, the pros-
ecutors, and the judiciary are now dealing
seriously with them.

There is no shame in the enforcement of
the law.18 Lava Jato provides a measurement
of the extent of Brazil’s corruption, but also
a measurement of Brazilians’ dedication to
anticorruption efforts. The Lava Jato oper-
ation is still ongoing, but it is already with-
out precedent. Corruption scandals are not
new to Brazil’s history, but never before
were top executives of the country’s biggest
construction companies arrested, tried, and
convicted. Never before Lava Jato had a sin-
gle director of Petrobras been charged with
a crime. Today, four of them and a ceo are
serving prison terms. Eight powerful poli-
ticians have been convicted and some ar-
rested, including the former speaker of the
House. Several congressmen are being in-
vestigated and prosecuted before the Su-
preme Court for bribery and money laun-
dering (and not because of their political
opinions).

Several measures have been essential
to the success of Operação Lava Jato, in-
cluding:
· The creation of task forces by the po-
lice and federal prosecutors to concen-
trate effort and resources on the investi-
gation and to prosecute serious bribery
and money laundering crimes.
· The use of pretrial detentions only in
cases in which there was strong evi-
dence of the crimes or in which deten-

tions would prevent new crimes from
being committed.
· The use of plea agreements to disrupt
complicity and secrecy between crim-
inals and to advance investigations.
· Extensive international cooperation and
support from Switzerland and other
countries.
· Trying cases under public scrutiny, from
evidence and arguments to judgments.
· Speedy criminal procedures and trials.
· Strong public backing to prevent at-
tempts by powerful defendants to ob-
struct justice.

All of these factors have contributed to
progress in enforcing the rule of law in
Brazil.

Much more must be done in the fight

against corruption, and it is too soon to
say whether Brazil will exchange its cur-
rent system for one fully committed to ef-
fective accountability for crimes commit-
ted by powerful politicians and business-
people.

Even so, it is important to highlight that
since 2015, millions of Brazilians have
protested against corruption. For exam-
ple, in March 2016, more than three mil-
lion people occupied the streets in sever-
al state capitals and major cities in peace-
ful demonstrations. It is true that these
demonstrations were also motivated by
other causes, such as dissatisfaction with
the state of the economy and with the for-
mer government. But the Lava Jato oper-
ation was a common cause that united
demonstrators. The fight against corrup-
tion has definitively entered Brazil’s pub-
lic policy agenda and will influence polit-
ical debates for years to come.

Hopefully, it will be possible to look back
some years from now and say that Lava Jato
made the national economy, the rule of law,
and democracy stronger in Brazil. Maybe
it will be possible to say systemic corrup-

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tion was overcome and that it became a sad
memory from Brazil’s past. We cannot take
this result for granted, but there is some
hope. At the very least, the Lava Jato cases,

like Criminal Case 470, represent a clear
break with a past of impunity and with tol-
erance for systemic corruption.

endnotes
1 Basic information about Operação Lava Jato is available at Ministerio Publico Federal, “Caso Lava
Jato,” http://www.mpf.mp.br/para-o-cidadao/caso-lava-jato (accessed March 10, 2018).
2 I am a federal trial judge in Brazil working in a role analogous to that of a district federal judge
in the United States. Criminal cases are normally tried and sentenced in Brazil by a trial judge
sitting alone, while jury trials are only used in murder cases. Federal judges in Brazil also have
other responsibilities, such as ordering pretrial detentions and authorizing investigative mea-
sures such as wiretaps or searches and seizures. My court in Curitiba is responsible for try-
ing most of the Lava Jato cases.

3 hc 84.078, Supremo Tribunal Federal, February 5, 2009. All Brazilian Supreme Court decisions

are available at Supremo Tribunal Federal, http://www.stf.jus.br.

4 The Brazilian Supreme Court received 56,257 new cases in 2017. These statistics are available at
Supremo Tribunal Federal, “Movimento Processual,” http://portal.stf.jus.br/textos/verTexto
.asp?servico=estatistica&pagina=movimentoProcessual.

5 Ação Penal 470, Supremo Tribunal Federal, December 17, 2012. The opinion for the Court was

delivered by Justice Joaquim Barbosa.

6 It is important to note that there are pending appeals against several of these convictions that

could overrule them.

7 The Mani Pulite operation also revealed systemic corruption in contracts of the public sector
in Italy. For a description, see Alberto Vannucci, “The Controversial Legacy of Mani Pulite:
A Critical Analysis of Italian Corruption and Anti-Corruption Policies,” Bulletin of Italian Politics
1 (2) (2009): 246.

8 Regarding the cost of the Abreu e Lima Refinery, see Raquel Landim, “Refinaria Abreu e Lima dará
prejuízo de us$ 3,2 bi,” Folha de S. Paulo, December 18, 2015, http://www1.folha.uol.com.br/
poder/2015/01/1576627-refinaria-de-abreu-e-lima-dara-prejuizo-de-us-32-bi.shtml.

9 For example, the “Calcutta Operation” (Operação Calicute) was inspired by Lava Jato and result-
ed in several criminal convictions against corrupt officials of the State of Rio de Janeiro. Some
information about the Calcutta Operation is available at https://pt.wikipedia.org/wiki/Opera
%C3%A7%C3%A3o_Calicute (in Portuguese, accessed March 20, 2018).

10 See Addiopizzo, http://www.addiopizzo.org.
11 Title 18, Section § 3142.
12 United States v. Salerno, U.S. 739, 107 (1987).
13 About ninety-seven pretrial detentions were ordered in Operação Lava Jato; however, most of
them were later followed by criminal convictions. At the time of this writing, there were only
six defendants in pretrial detention who had still not been tried.

14 Stephen S. Trott, “The Use of a Criminal as a Witness: A Special Problem,” Hastings Law Journal

47 (5/6) (1996).

15 hc 126.292, Supremo Tribunal Federal, February 17, 2016; and adcs 43 and 44, Supremo Tri-
bunal Federal, tried on October 5, 2016. These judgments overruled hc 84.078, Supremo Tri-
bunal Federal, tried on February 5, 2009.

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16 Unfortunately, in August 2017, information emerged that some justices were again consider-

ing changing their votes about the rule.

17 adi 4.650, Supremo Tribunal Federal, September 17, 2015.
18 President Theodore Roosevelt, in a speech before the U.S. Congress in 1903: “The exposure
and punishment of public corruption is an honor to a nation, not a disgrace. The shame lies
in toleration, not in correction. No city or state, still less the nation, can be injured by the
enforcement of law.” Theodore Roosevelt, “Third Annual Message, December 7, 1903,” The
American Presidency Project, http://www.presidency.ucsb.edu/ws/?pid=29544.

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