July 11 (Bloomberg) — A Brazilian lawmaker carrying $2.6 million in his luggage was detained by Federal Police at Brasilia’s airport as he prepared to board a private plane bound for a city 60 miles from the capital, police said.
Lower house deputy Joao Batista Ramos da Silva, of the opposition Liberal Front Party, told investigators the money was collected as tithes from the Universal Church of the Kingdom of God denomination, a police spokesman said. Silva was accompanied by six other people and as many as seven suitcases, said the spokesman, whose name can’t be used under Federal Police policies.
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Silva’s detention comes as members of the ruling coalition of President Luiz Inacio Lula da Silva’s Workers’ Party are under investigation for trading jobs and money in exchange for congressional support and as congress probes allegations a businessman close to the party brought suitcases of cash to the capital for pay offs.
“As ugly as this is, it benefits the Lula administration on the margin,” Lehman Brothers Inc.’ chief Latin America economist John Welch wrote in a note to clients. “But overall, this is a bad development.”
While the investigations so far don’t threaten the credibility of the country’s political leadership, the latest incident with Silva increases the risk, Welch said.
The president of the Liberal Front Party, Jorge Bornhausen, called today in a statement for a meeting of the party’s executive committee the day after tomorrow, saying he considered the incident “very serious.” Staff reached by phone at Silva’s office in Brasilia declined to comment.
Lula
Lula announced on July 5 measures to purge corruption in politics and changed five ministers since last month to bolster support for his 2 1/2 year old administration. The accusations against members of his party and of his government range from tax evasion to illegal campaign funding.
The opposition, with the Liberal Front and the Social Democracy parties in the forefront, is leading the congressional probe.
The Liberal Front, which has opposed Lula’s coalition since January 2003, holds 55 seats out of 513 in the lower house and 16 of 81 in the senate. Silva, elected in 2002, is one of the deputies representing the state of Sao Paulo. His lower house seat gives him immunity from prosecution or arrest.
The police spokesman said neither Silva nor those detained, among them two bishops, gave satisfactory explanations for the origin of the money.
“He must quickly explain the source of that money,” Rodrigo Maia, the party’s leader in the lower house, told journalists in Brasilia.
Silva, a former president of Church’s Rede Record television channel, Brazil’s third-biggest, was stopped on the basis of an anonymous tip to investigators, the Federal Police spokesman said.
Legal Limits
Brazilian law imposes limits on the amount of cash that can be carried without making a report to tax and financial authorities.
On July 8, Jose Adalberto Vieira da Silva, 39, a staff member of the ruling Workers’ Party, was arrested in Sao Paulo’s Congonhas airport with $184,000 in cash in his suitcase and clothing, and detained on charges of breaking customs laws. That triggered the resignation of party president Jose Genoino the next day.
Silva’s lawyer, Roberto Leao, was not in his office in Sao Paulo and did not respond to a message left on his voicemail.