From: tsen+@OZARK.EDRC.CMU.EDU (Chung Kang Tsen)
Subject: LOOTING BRAZIL extraido do NYT
Originator: tsen@OZARK.EDRC.CMU.EDU
Organization: School of Computer Science, Carnegie Mellon
Date: Wed, 11 Nov 1992 08:24:44 GMT

Esta e' a copia da copia da copia... feita tambem sem autorizacao da NY Times.
Alias que bela sacada esta de usar OCR pra' extrair trechos de jornais
e revistas. Sera' que os OCR's conseguem ler portugues com aquelas
acentuacoes malucas? Seria otimo poder ler artigos da Veja ou Folha sem
precisar gastar o precioso tempo das caridosas almas que fazem as transcricoes.

--Tsen

===================================================================
=09Scanned sem autorizacao da NY Times Magazine (Nov,8) vai o
texto abaixo para os brasileiros cinicos da rede. Desculpem o erros
de spelling, mas o OCR nao e' dos melhores.

ulisses.
*************************************************************************

LOOTING BRAZIL=20

A president swept into
office as a corruption-fighter is being
swept out by multimillion-dollar
influence-peddling scheme

by James Brooke

(James Brooke is the Rio de Janeiro bureau chief
of The New York Times.)

 =20
 IT IS ONE THING TO TALK ABOUT=20
austerity," Fernando Collor de=20
Mello lectured Brazilians two years
ago, soon after sweeping Brazil's
first free presidential elections in
three decades. "It is another thing to
practice it."
      To punctuate his point. the tele-
 genic 40-year-old apostle of clean government
 announced that he would live in his family's
 modest ranch house in Brasilia as a "demon-
 stration of austerity."
  But as Collor spoke, landscape architects were
 at work at the house, drawing up plans to move
 15-ton rocks and hundreds of trees for the con-
 struction of a three-acre garden oasis that would
 ultimately include eight artificial waterfalls, a
 1,000-square-foot swimming pool and a triple-
 level lagoon stocked with Japanese carp. The
 final bill, $2.5 million, was quietly paid by Paulo
 Cesar Farias. the President's former campaign
 finance chief and shadowy alter ego. As stunned
 Brazilians would later find out. the millions of
dollars that sustained Collor's lavish life sty]e
were already beginning to flow from pipes of
corruption that Farias, known to all as PC. rap
idly buried in the Federal Government.
 With Collor now facing the world's first presi-
dential impeachment trial in modern history.
detective work has peeled a way layers of decep-
tion to reveal with remarkable clarity the me-
chanics of stealing millions from a third world
government.
  "They established goals; by month x, we are
going to net $500 million," says Renan Calheiros,
a legislator who led the pro-Collor forces in the
Chamber of Deputies. Exactly how much was
netted may never be known. Investigators have
established that Farias managed to suck at least
$32 million out of the pockets of taxpayers and
businesses, and this during two years of Brazil's
deepest economic recession in decades. And in-
vestigators believe they uncovered only about 10
percent to 30 percent of the total cash flow.
 Brazil, the world's fifth-largest nation, is a
highly tolerant society that is quick to forgive
things like extramarital affairs or drug use.
X-From bitter experience, however, Brazilians are
suspicious of sudden wealth in their leaders.
 How, they wondered, could a man of relatively
modest means live like a plutocrat -- with Baby-
lonian gardens in the backyard, a new Mercedes
convertible, a $1.7 million apartment in Paris and
a $20.000 monthly jewelry and clothing allowance
for his wife -- all on a pretax salary of around
$30,000? In the campaign, after all, he had listed
as assets only a stock portfolio valued recently at
$16,000 and a penthouse apartment and beach
house worth $500,000. And, on taking office, he had
stopped accepting dividends from his family's
media company and had decided against renting
out his properties.
 In another era, the mystery might never have
been solved. But Collor, a vocal advocate of mod-
ernization, fell victim to the very changes he
promoted. In a landmark advance for Latin
American democracy, Brazil's feisty Dress. inde-
pendent Congress and professional police force
dared to challenge and fully investigate the Presi-
dent's financial wizardry. Acting on vague ru-
mors of Swiss bank accounts, investigators rap-
idly uncovered a paper and electronic trail a mile
wide: 40,000 canceled checks, kilometers of tele-
phone bills, wads of receipts for bribes and com-
puter files with kickback percentages carefully
noted in electronic spreadsheets.

IN TOTAL, THE EVIDENCE ASSEMBLED BY
a Congressional investigative panel adds up to
half a ton, and dozens of indictments could come
down. But this is no dry accounting tale. Over the
last six months, daily revelations have gripped
Brazilians the way the Watergate hearings held
Americans spellbound two decades earlier. And
for a nation with a passion for steamy soap
operas, "Collorgate" offered a real-life pulp story
filled with sex and intrigue:
 Was it simply moral outrage that moved Pedro,
Fernando's handsome younger brother, to blow
the corruption scheme wide open in May? Or was
it, as most Brazilians believed, smoldering re-
sentment over Fernando's attempt to seduce his
sultry wife, Thereza?
 And what about Dona Leda, the clan's iron-
willed matriarch, who promptly declared Pedro
emotionally unbalanced and fired him from his
post as president of the family media empire?
Was she a villain, trying to cover up the sordid
misdeeds? Or a heroine, suffering a severe heart
attack under the terrible strain?
 What drove Rosane, the President's gaptoothed
bride who rose from modest circumstances, to
indulge in wild spending sprees in Paris and
Rome? Could it have been a need for revenge
against her aristocratic in-laws. who never ac-
cepted her and pointedly spoke French when she
was in the room?
 Who was this Zelia Cardoso de Mello, the 37-year-
old Economy Minister who had a passionate, if
doomed, romance with Bernardo Cabral, the mar-
ried, 58-year-old Justice Minister. How did she - no
relation to the President -
get so far, so fast? Further,
had she accepted more from
PC than a now infamous
"Hermes scarf"?
 And at the center of the
spider web. the ultimate cu-
riosity, was PC, the musta-
chioed, one-time seminar-
ian, whose lethal mixture of
unctuous charm and grand
larceny ultimately brought
down his best friend. the
President.
 In the Senate trial that began last week, Collor is
pleading that he was too busy with state affairs to
notice the millions of illicit dollars pouring into his
family's accounts. Collor's lawyers, who estimate
that PC's scheme netted between $150 and $200
million, say the President was unaware of the
abuse of his trust. Prosecutors say they will not try
to prove that Collor masterminded the scheme,
only that he knowingly accepted tainted money.

BRAZIL'S REAL-LIFE NOVELLA OPENED IN
a Beijing hotel room in 1988.
 Fernando Collor de Mello. then governor of
Alagoas state, was killing time reading a book,
"The Selling of the President, 1968" by Joe
McGinniss. Was Brazil, he wondered, on the
verge of its first direct presidential election since
1960, ripe for the Madison Avenue techniques that
had lifted Richard Nixon to the United States
Presidency 20 years earlier?
 No matter that no major party was interested
in Collor, a political novice with an undistin-
guished record for administering impoverished
Alagoas, Brazil's Mississippi. No matter that Ala-
goas, Brazil's second-smallest and most back-
ward state. ranked high in illiteracy and such
medieval plagues as cholera and leprosy. Collor
calculated that by packaging a simple theme of
anticorruption with a clearcut image of modern-
ization he could win over Brazil, a nation where 75
percent of the population watches television.
 Shedding his lifelong appellation, "Mr. Mello,"
the candidate adopted the more action-oriented
"Mr. Collor." Avoiding the chummy Latin back-
slapping embrace, this standard-bearer of a new
 morality started to stick out his right hand for an
 American-style handshake. "Style is everything,"
 said candidate Collor. former director of his fam-
 ily television station in Alagoas.
 Indeed. Brazil's first television President has had
 a lifelong obsession with his good looks. As a 19-
 year-old college student in Brasilia, he modeled
 Pierre Cardin suits in a charity fashion show. As a
 freshly minted President, he was selected by Peo-
 ple magazine as one of the world's "50 most beauti-
 ful people." Starting with an
athletic frame hardened by
years of karate practice,
Brazil's premier clothes-
horse   sported   mono-
grammed shirts with gold
cuff links and hand-tailored,
two-button   European-cut
suits. As President, he chose
accessories that projected a
millionaire life style: silk
ties. Cuban cigars. a $1,000
Mont Blanc fountain pen and
a $2,000 Breitling watch.
 The presidential campaign
bore out the acuity of Collor's
political insights. To cam-
paign crowds thirsty for re-
form after 25 years of mili-
tary dominance in poiitics, the
muscular young candidate
would  bellow:  "Whoever
steals, goes to jail." Across a
continent-sized nation, this
new-generation politician with matinee idol looks
and a fashionable, if semidigested, Thatcherite
ideology, struck a resonant chord.

       BACK HOME IN MACEIO, THE
         state capital of Alagoas, where
         Collor served, successively, as
         mayor, federal deputy and gover-
         nor, opposition politicians had
         messier memories of Brazil's new
         anticorruption crusader.
        The scion of a local political
oligarchy, Collor was appointed mayor of Maceio
at 29 by the ruling military. While there might
have been other candidates in the seaside city of
400.000, the young Collor was backed by his fam-
ily's locally powerful media conglomerate, which
owned one newspaper. one television station and
 three radio stations in Alagoas.
 Recalls a socialist candidate for mayor of Ma-
 ceio. Ronaldo Lessa: "Collor paved one end of a
 road. He paved the other end of the road. He filmed
 both ends. Then, he presented the tape on television
 to voters as a paved road." In 1982, to make the =20
jump from mayor to congressman, Col-
lor placed 4,000 ward heelers
from around the state on the
city payroll as school aides.
In 1988. to establish a cam-
paign chest for the presiden-
cy, he returned to local sugar
cane barons $100 million in
taxes -- reportedly in ex-
change for about 20 percent
delivered to PC, who had al-
ready emerged as his local
bagman.  Battling  these
charges with the same single-
minded vigor he displays to-
day in the impeachment fight,
Collor threatened to sue any
newspaper that dared publish
the accusations.
 "What we are seeing today
on a national level in Brazil
is simply an amplification of
the government of Fernando
Collor in Alagoas." says
Djalma Falcao. another po-
litical adversary in Maceio.
 But reaching the presiden-
cy of Latin America's pow-
erhouse is the big time. As
President-elect. Collor con-
ducted a world tour, winning
praise from the business
and foreign policy establish-
ments of Europe, Japan and
the  United  States.  Im-
pressed by the young Presi-
dent's derring-do -- piloting
a tank, camping in the Ama-
zon and breaking the sound
barrier in a fighter jet -
President Bush likened Col-
lor to Indiana Jones.
  Collor has indeed made
 genuine progress. opening the
 economy to foreign trade and
 investment, starting to priva-
 tize state companies, disman-
 tling Brazil's nuclear bomb
 program, reducing Amazon
 deforestation and expanding
 Indian reservation lands. And
 on his inauguration day,
 March 15, 1990, his Economy
 Minister tried a novel anti-
 inflation measure that was
 widely praised, at least out-
 side Brazil. Experimenting
 on a captive classroom of 150
 million Brazilians, Zelia Car-
 doso de Mello froze all bank
deposits over $1,200 for 18
months. (The program was a
colossal failure. praducing
suicides, heart attacks, a 4
percent plunge in economic
activity - and barely a dent
in inflation. Since that one-
time shock remedy. consum-
er prices have increased
13,000 percent.)

THE SALIENT FACT, HOW-
ever, is that lndiana Jones
entered Brasilia's marble
and glass Palace of the High
Plains hand in hand with his
invisible partner from back
 home: the balding, round-
 shouldered PC. Once known
 as "Paulinho Gasolina" for
his habit of siphoning gaso-
line out of parked cars in
 Maceio, Paulo Cesar Farias
glued himself in the late
 1970's to Collor's rising star.
 "Like it or not, PC is ex-
 tremely intelligent," Pedro
 Collor de Mello. the Presi-
dent's younger brother, said
of the affable, 47-year-old PC.
"He studies the human spe-
cies with great discipline.
with great determination."
 Graduating to the Federal
Government. PC designed an
extortion and influence-ped-
dling system that congres-
sional investigators later de-
scribed as "an assault on the
state." And whatever Collar
may or may not have known
about the corruption scheme,
a presidential aide testified
that PC and the President
consulted almost daily by
telephone.
 In essence, PC operated a
simple  influence-peddling
scam, based on the percepe-
tion among business people
that he could deliver favors
from the President and from
the Economy Minister. Car-
doso. In turn, investigators
say, a portion of the proceeds
bankrolled the life styles of
the President and the Econ-
omy Minister.
 "When someone would re-
sist, PC would say. 'Listen,
friend, don't be a drag, 70 per-
cent d this is for the boss,
only 30 percent is for me,' "
Pedro Collor de Mello said in
an interview. With that 30
percent share - at least $20
million, investigators say --
PC was silently building a
business empire that includ-
ed a domestic airline and a
national television network.
Pedro Collor says that his in-
vestigation of these business
activities so alarmed PC that.
in April, a PC emissary of-
fered to pay him $50 million to
leave the country quietly.
 The shakedown purred
 along smoothly until May 13,
 when Pedro exploded his
 first, bombshell interview in
 Veja, Brazil's leading news
 magazine. Since then, police
investigations, congression-
al hearings and investiga-
tive reporters competing
like piranhas have assem-
bled a portrait of corruption
on a scale that startled even
cynical Brazilians.

TO  BECOME  LATIN
America's premier influ-
ence trafficker, PC careful-
ly wove a sticky web of gifts
and bank deposits.
 Carefully insulating the
President, his wife and the
Economy Minister from di-
rect involvement, PC made
payments to secretaries and
wrote checks drawn on ac-
counts opened =A1n the names
of "ghosts" -- dead people
with fictitious Social Securi-
ty numbers. But the ac-
counts turned out to be man-
aged by real people working
at two PC-owned companies
that were little more than
collection bins for bribes,
Brasil Jet and Empresa de
Participacoes e Construcoes
Ltda., or E.P.C. Apparently
fearing a future double
cross.  PC  made  one
exception to his camouflage
system:  he  personally
signed a series of checks
made out directly to Rosane
Collor de Mello, the Presi-
dent's wife.
  "They  found  40.000
 checks - it is astounding
 that someone would steal
 money and distribute it by
 check," says Stephen C.
 Robinson, an investigator
 for Kroll Associates. The
 New York-based company.
 which has investigated fi-
 nancial tricks by leaders of
 Haiti, Iraq and the Philip
 pines, was hired by Brazil's
 Congress to research PC's
 overseas tentacles.
  PC methodically placed
 operatives in key positions
 where they could control
 the tap of public funds. One
 of PC's brothers, Luis Ro-
 mero Farias, was given the
 No. 2 position in Brazil's
 Health Ministry. Vitor Wer-
 ebe, a lawyer who repre-
 sented PC in court cases in
 Miami, became the Sao
 Paulo director for Brazil's
 Internal Revenue Service.
 (Werebe was replaced this
 year. PC. who in 1990 de-
 clared an income of $24,000,
 now faces an unpaid tax bill
 that, with penalties, could
 hit $100 million.)
  In recent weeks. police de-
 tectives tapping into a com-
 puter seized from PC's office
 in Sao Paulo have unlocked
 what they call "a manual of
 corruption" Notes accompa-
 nying a Lotus 1-2-3 spread-
 sheet file recommend target-
 ing ministries with high budg-
 ets - health, transport and
 economy - and skipping low-
 budget ministries like justice.
 Another note. written after a
 cabinet shakeup last March,
 laments the loss of "dozens of
 operators." But the anony-
 mous author observes with
 obvious satisfaction that "the
 principal  pillar  remains
 standing, and several friend-
 ships are more solid than a
 marriage." Another electronic
 file warned against "involv-
 ing the President."
 When police raided E.P.C.
 in June, they found that this
 PC "consulting" company
 had on file 600 phony re-
 ceipts, but no work con-
 tracts. With only 12 employ-
 ees, none of them with a col-
 lege education, the company
 reportedly netted $55 million
 during the tenure of the Col-
 lor Government.
 Most of the money came
 from private companies
 seeking Government con-
 tracts, Government favors
and sometimes advance in-
formation on crucial policy
decisions. For example, Ce-
tenco, a major construction
company, paid $206,000 to
E.P.C. for "verbal advice on
tax issues." Two months lat-
er, the company won a con-
tram worth several million
dollars to build a segment of
the Red Line, a highway that
sped visitors from Rio's air-
port to the Earth Summit in
June. Flavio Correia Rabelo,
president of another con-
struction company, testified
before congress that he paid
E.P.C. $200,000 for advance
information about changes
in economic policy.
 On Dec. 13. 1991, three Ala-
goas sugar cane planters
paid $350,000 to Brasil Jet.
The following day, President
Collor signed a decree ex-
empting planters in the re-
gion from a value added tax
Antonio Emirio de Moraes,
one of Sao Paulo's most
prominent  industrialists.
tried to explain to Congress
why his company paid
E.P.C. $239,000, by saying:
"Paulo Cesar Farias pre-
sented himself as an inti-
mate friend of President
Fernando Collor."
 If PC sniffed a particularly
lucrative  shakedown,  he
would personally make the
approach, often arriving inhis
customized, black Learjet
that he called the Black Bat.
 E.P.C.'s electronic spread-
sheet also had a three col-
 umn section listing con-
 struction projects, percent-
 ages owed and the dates
 payments were due. The
 computer contained exten-
 sive personal files on all the
 ministers and government
 Secretaries. noting personal
 matters like who liked to
 travel overseas, who had
 children in private schools,
 whose wives liked jewelry
 and whose liked perfumes.
  Auditors who have studied
 the computer files believe
 that E.P.C. was also charg-
 ing money-starved compa-
nies 10 percent commisions
to unfreeze their frozen
bank accounts. Moreover,
both PC and the President
removed a total of about
$250,000 from their bank ac-
counts in days leading up to
the surprise freeze. In a
mockery of the Collor Ad-
ministration's free-market
ideology, police allege that
companies belonging to Bra-
zil's interstate bus cartel
paid $l million each time the
Infrastructure Ministry ap-
proved fare increases well
above the inflation rate.
 To ship millions of dollars
overseas. PC apparently used
his executive jet companies.
Brasil Jet paid $450,000 a
month to Miami Leasing for
the lease of jets in Brazil.
Since PC owned Miami Leas-
ing, it was simply a maneuver
to electronically transfer the
loot out of Brazil.

        DURING   THE
         three-month con-
         gressional investi-
         gation  of  the
         scheme, old-school
         politicians seemed
         to find something
        un-Brazilian about
all the fuss.
 "If someone likes the
President and wants to pay
his bills. there is nothing
wrong, as long as there is no
influence trafficking:' pro-
tested Angelo Calmon de Sa
then-Minister of Regional De-
velopment. "What's wrong
with someone wanting to
pay the bills of someone
else? It's not a crime, is it?"
 In an interview at his Rivi-
era-style mansion in Maceio
in early September, PC confi-
dently brushed off the accu-
sations as "absolutely un-
true" and "a political carni-
val."
 Such  arguments  were
greeted with derision by
Brazil's press and by mass
street demonstrations by
Brazil's populace.
  Veja treated readers to a
 photographic tour of Collor's
 PC-financed garden, a nou-
veau riche folie that the
 magazine called "a botani-
cal slap in the face."
  Attempting damage con-
trol, Collor's advisers dis-
tributed to television sta-
tions and congressmen a
counterattack video that
filmed the garden in a harsh
light, with the waterfalls
turned off. and with a sound
track describing the plants
as "cheap and common."
  But there was nothing
cheap or common about the
life style that PC bankrolled
for the first family. PC paid
for two cars for Collor, includ-
ing a Mercedes 500 SL. He
paid child support of Collor's
 two adolescent sons, who live
 in Europe with Collor's first
 wife. Learning that the Presi-
 dent was worried about kid-
 nappers. PC provided an ar-
 mored car and chauffeur for
 the boys when they visited
 Rio de Janeiro.
  Turning to real estate, PC
 paid $165,000 for renovations
 to Collor's  apart-
 ment, a penthouse duplex
 with a sweeping view of the
 South Atlantic. In Paris, the
 President's favorite foreign
 city. PC shelled out $2.5 mil-
 lion for apartments for Col-
 lor and himself in a building
 on an elegant. tree-lined ave-
 nue on the Seine. Located a
 few doors down from Bra-
 zil's embassy in Paris, the
 apartments are a two-block
 stroll from the Champs Ely-
 sees.
  Inside  the  President's
 house. according to testimo-
 ny and a trail of canceled
 checks, PC paid for every-
 thing from artwork and food
 to salaries for a platoon of
 maids, cooks, gardeners,
 butlers and a French-lan-
 guage tutor for Rosane. to
 veterinary bills for Rosane's
 white poodle, Vina. Money
 washed so freely through
  the house that Maria Izabel
Teixeira. the family's interi-
or decorator abandoned her
decorating  business  and
signed on as the First Lady's
private secretary. In this ca-
pacity, she deposited $965,000
of PC payments to Rosane
Collor. Enough trickled down,
however. to enable the secre-
tary to buy a $250,000 apart-
ment in Brasilia.
 With her Rolex watch,
Louis  Vuitton  briefcase,
pageboy haircut and cherry
red lip gloss, Brazil's petite
First Lady seemed to have
traveled light years from
Canapi, her hometown at the
end of a dirt road in Alagoas'
drought-stricken  interior.
Married to Collor as a 19-
year-old college freshman,
Mrs. Collor had always suf-
fered at the hands of her
snooty in-laws. When her
husband won the presiden-
cy, she was quick to grasp
the possibilities.
 In August 1991. when Collor
slipped off his gold wedding
band during a marital crisis.
PC checks came to the rescue
paying for $2,000 worth of inti-
mate wear for Rosane -
smoked stockings. mesh pa-
jamas and cambric cami-
soles - purchased at a store
called Amor Perfeito, or Per-
fect Love.
 Accompanying the Presi-
dent on an official visit to
Rome last December. Mrs.
Collor led an eight-car mo-
torcade to the fashionable
boutiques around the Piazza
di Spagna. Within a few
hours, she had spent $15,000
On designer suits. evening
 coats, shoes and matching.
 handbags.  Self-conscious
 about her smile, she had PC
 pay $33,000 to a Rio ortho-
 dontist to close the gap be-
tween her front teeth.
  "Madame is just spending
 too much," PC would groan
 at Cocktail parties, rolling
 his eyes heavenward in
 mock dismay. By letting the
 world know he was paying
the First Lady's bills, PC
crafted a public image of in-
timacy with the President.
After PC bought a house
next door to Collor's lake-
front estate in Brasilia, the
influence trafficker would
worm into business talks the
fact that "Fernando" often
stapped by unannounced to
chat and sip Logan whisky.

IN BRAZIL, NO FIRST-
class  influence-trafficking
ring could succeed without
the compliance of the nation's
second-most-powerful  offi-
cial: the Economy Minister.
 Until recently, Brazilians
had regarded Collor's first
Economy Minister as a rath-
er bizarre figure. but honest.
Universally known as Zelia.
the former economics pro-
fessor exemplified Collor's
initial policy of naming to
his cabinet only people un-
der 40 years of age who had
never before served as min-
isters.
 Her 14 months in the Gov-
ernment provided an almost
unbroken string of policy
blunders and personal scan-
dals, beginning with the di-
sastrous anti-inflation cash
freeze. To ease the pain of
that failure, Zelia turned to a
friendly shoulder offered by
Bernardo Cabral. the mar-
ried Minister of Justice. Af-
ter she resigned in May 1991.
she applied the finishing
touches to that doomed af-
fair with a scorching kiss-
and-tell memoir.
 With all these distrac-
tions, reporters failed to de-
tect that PC had quietly in-
vested over $500,000 in Zelia
and her economic team.
 According to checks that
came to light in recent
weeks. PC spent $283,000 to
pay Brasilia hotel bills run
up by Zelia and about 25 of
her top aides, largely at the
Academia de Tenis, a re-
sort-style hotel. PC has ad-
mitted to picking up the ho-
tel tab, but has said the mon-
ey came from leftover cam-
paign funds.
 In addition. $236.000 worth
of PC checks ended up in an
account belonging to her as-
sistant. Joao Carlos Ca-
margo, who tald police that
he passed all this money to
Zelia, increasing her $30,000
salary sevenfold. The tattle-
tale secretary then pro-
duced a dossier of receipts
paid with PC money -- a
vacation for Zelia's mother
in Aruba, firstclass tickets
to London and New York for
Zelia's trysts with Bernardo,
and $68,000 worth of renova-
tions to Z=82lia's Sao Paulo
town house. The six-month
renovation included $6,000
for customdainted bath-
room tiles and $11,600 for
pure white bathroom mar-
ble. Police are also investi-
gating reports that Zelia
speculated heavily in finan-
cial markets.
 Pedro,  the  spoilsport
younger brother, has said
that PC also gave Zelia
"necklaces and designer
dresses." In a line that has
come to symbolize the entire
scandal, PC insisted in con-
gressional testimony that "I
only gave the former minis-
ter a Hermes scarf." Mar-
ried to one of Brazil's most
famous television comedi-
ans, Zelia had hoped to live
quietly, caring for her infant
daughter.  Instead,  she
meets regularly with her
lawyers. trying to fight an
expected indictment for ille-
gal enrichment.

     LUIS OCTAVIO DA
     Motta Veiga, for-
     mer president of
     Brazil's state petro-
     leum company, re-
     calls how PC visited
     him twice in Rio.
     trying to find out
which company would win
the 2250 million contract to
build an underwater plat-
form. Motta Veiga, who had
studied public administra-
tion at France's strict ecole
Nationale d'Administration.
refused to say and. eventual-
Iy, was forced to resign on
the grounds that he was not
"a team player."
 To the attentive, Motta
Veiga's parting shots as oil
company president in Octo-
ber 1990 were the first clues
to what would culminate
with Brazil's version of the
Final Days. But no one was
prepared for the May bomb
shell dmpped by Pedro Col-
lor de Mello, the President's
37-year-otd brother.
 Brazilians hardly blinked
when Pedro Mello charged
that over 20 years ago his
older brother introduced
him to cocaine and marijua-
na. But in a society strug-
gling under the weight of a
two-year-old recession. a po-
litical bomb was thrown by
Pedro's charges that his
brother and PC were split-
ting kickbacks, 70-30.
 lmmediately the Presi-
denrs defenders sought to
discredit his younger broth-
er. "I think Pedro is sick,"
 PC wouid say later. "His
 problem is personal envy of
 an older brother."
   Journalists were told that
 bad blood between the broth-
 ers dated back to an after-
 noon in 1987 when Fernando
 took advantage of his broth-
 er's business trip to Canada
  to try to seduce his wife,
  Thereza, in the state gover-
  nor's palace. In reality, Pedro
  moved against his brother be-
  cause the President and PC
  were investing millions of dol-
  lars in a rival Alagoas news-
  paper and radio conglomer-
 ate that threatened to push
  Pedro out of business.
   In a counterattack, the
  President  persuaded  his
 mother, Leda Collor de Mello.
 to dismiss Pedro and declare
 that he "is now going through
 a severe emotional crisis."
 Pedro immediate!y flew to
 Sao Paulo, submitted to a bat-
 tery of psychiatric tests and
 emerged waving a certificate
 attesting to his sanity.
  "It's not very pleasant to
 have your mother publicly
 call you a nut, and throw you
 out on the street." Pedro
 Mello reflected in late Sep-
 tember. Mother and son
 may never have a chance to
  reconcile. On Sept. 17, she
  picked up a Rio newspaper
  that carried a frontaage in-
 terview with Pedro. Minutes
 after reading Pedro's claim
 that the President "must
 want to see me six feet un-
 der," the woman who gave
 birth to Brazil's Cain and
 Abel suffered a heart attack
 and slipped into a coma
 from which she has yet to
 emerge. However, an at-
 tending phys=A1cian now says
 she precipitated the seizures
 by swallowing a bottle of
 prescription drugs.
  The effort to discredit Pe-
 dro failed to forestall a con-
 gressional inquiry. Through
 August. Brazilians were en-
 tertained by the televised
 testimony of a parade of 22
 witnesses. Before millions of
 viewers. the President's de-
 fenders repeatedly tripped
 over their own cyncism.
  Augusto Farias, a brother
 of PC and a congressman
 from Alagoas. threatened
 "to shake the Republic" by
 releasing a list of 100 con-
 gressmen and governors
 who received campaign con-
 tributions from PC in the
 1990 elections. The list was
 never released.
  In a last stand, Collor's
 private secretary testified
 that the millions spent on the
 Collor household came from
a $3 million campaign loan
made in 1989 in Uruguay,
which is known for its lax
banking laws. This defense
crumbled when a secretary
testified that lawyers work-
ing for her boss, Alcides dos
Santos Diniz, forged the loan
documents two weeks earli-
er in a Soo Paulo law office.
In return, Diniz, a polo-play-
ing supermarket chain heir,
apparently hoped to win be-
low-market loans from state
pension funds to build a $385
million hotel and office com-
plex in downtown Sao Paulo.
  By the end of the inquiry, in
late August, congressmen
were awed at how easy it had
been for amateur investiga-
tors to unravel the corruption
scheme. Benito Gama. a pro-
Government deputy who pre-
sided  over  the  inquiry,
mused: "We lit a fire for a
barbecue, and ended up set-
ting the house on fire."
 In an uncessful bid to win a
congressional vote over an
impeachment trial, Collor's
ministers funnelled millions
of dollars to pet projects of
swing-vote congressmen. But
with mass anticorruption pro-
tests spreading thrnugh ma-
jor cities of Brazil's Atlantic
coast, Collor surrendered his
powers to the Vice President.
Not a word of remorse was
heard from the President or
his wife.
  Kicking off his legal de-
fense late last month, Collor
blamed all on PC. and
vowed, "I shall return." A
lawyer for PC shot back that
his client will not become "a
punching bag," and threat-
ened to release documents
"that compromise the re-
moved President."
 To the end, Collor apparent-
 ly never believed that caurts
 and jails were made for a
 man of his social class. After
all, when he was 14, his father
shot a fellow senator dead on
the Senate floor - and never
spent a day in jail for it. As for
the First Lady, as her hus-
band teetered on the verge of
becoming Brazil's first Presi-
dent in 103 years of republi-
can history to be impeached,
she sounded more and more
like a Latin American Marie
Antoinette.
  "Brazil has 140 millian in-
habitants," she told the
newspaper Folha de Sao
Paulo. "How many people
were in the streets? 500,000
people? And the rest? It was
the simple, humble people
who voted for the President.
They weren't in the streets.
The political parties, the
elite, those with culture.
with a certain intelligence,
with a certain vision - they
were in the streets."=20

Ulisses Thibes Mello                     | Lamont-Doherty Geological=20
e-mail: ulisses@lamont.ldgo.columbia.edu | Observatory at Columbia Universi=
ty
        mello@lamont.ldgo.columbia.edu   | Route 9W exit 4
CIS   : 70254.734@compuserve.com         | Palisades, N.Y.   10964
voice : 1-914-359-2900 x444              |
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=20
Newsgroups: soc.culture.brazil