Brazil top court votes to indict lower house speaker on graft charges

BRASILIA (Reuters) - A majority of Brazil’s Supreme Court voted to accept corruption charges against lower house speaker Eduardo Cunha on Wednesday, putting him on trial for allegedly accepting bribes on contracts for two drill ships leased by state oil company Petrobras.

Brazil's Lower House Speaker Eduardo Cunha leaves his home in Brasilia, Brazil, in this December 15, 2015 file photo. REUTERS/Ueslei Marcelino/Files

The ruling, which must be officially confirmed at the end of the court’s session, is a setback to Cunha as he struggles to fend off a request from Brazil’s top prosecutor for his removal as speaker for obstructing investigation into the Petrobras graft scandal.

A bitter political rival of President Dilma Rousseff, Cunha could also lose his seat if an ethics committee inquiry underway finds he lied about undeclared Swiss bank accounts.

Cunha, who comes from the PMDB party that is Rousseff’s main coalition ally, broke with her last year and in December took up an opposition request for the impeachment of the president.

But the case against him at the Supreme Court, the only court that can try elected officials in Brazil, could hasten Cunha’s downfall and undermine efforts to impeach Rousseff.

Even the main opposition party to the Rousseff government, the PSDB, called on Cunha to step down after the court vote.

“Now we have a speaker who is under investigation by the House ethics committee and, what’s worse, indicted by the Supreme Court. It’s the limit. He has to go,” said PSDB leader in the lower chamber, Antonio Imbassahy.

Cunha has said repeatedly that he will not resign, even though he faces charges of receiving a $5 million bribe in the widening price-fixing and political kickback scheme that has landed executives of top engineering companies in jail and ensnared dozens of politicians from Rousseff’s coalition.

In August, a judge sentenced former Petrobras international director Nestor Cervero to over 12 years in prison for corruption and money laundering related to the bribe allegedly paid to Cunha in exchange for contracts with Korean shipbuilder Samsung Heavy Industries for two drillships.

Executives at Samsung Heavy Industries were not charged in the case involving the drillship Petrobras 10000, which was leased jointly by Petrobras and Mitsui in 2006, and the Vitoria 10000, hired by Petrobras in 2007.

Cunha, a master of congressional procedure, has used every trick in the book to delay judicial action against him, though the mounting allegations against him have reduced his power.

On Tuesday, after weeks of filibustering by his supporters, the house ethics committee decided there were grounds to probe Cunha over the bank accounts that Swiss prosecutors located along with lavish credit card expenses by Cunha’s wife and daughter, including coaching at a top Florida tennis academy.

“This is the first time a speaker of the house is on trial for corruption in Brazil and he is still not resigning, which shows the extent of the moral deterioration of Brazilian politics,” said Gabriel Petrus, with the Brasilia-based consultancy Barral M Jorge Associates.

Reporting by Anthony Boadle; Editing by Andrew Hay and Lisa Shumaker