Moro’s U.S. Law Firm Received R$40 Million From His Lava Jato Targets, Says Federal Audit Court

Brazil’s Federal Audit Court has asked the Attorney General to freeze presidential pre-candidate Sergio Moro’s assets. The court (TCU) says that the law firm which until recently employed the disgraced ex-judge received more than R$40 million ($8 million USD) from companies he convicted in Operation Lava Jato, and with whom he negotiated leniency agreements.

A spiral of disgrace surrounding presidential pre-candidate Sergio Moro only accelerates. With the U.S.-trained former anti corruption hero’s poll numbers now stuck at single figures, and amid rumours he will abandon his presidential campaign altogether, the latest scandal puts even his backup plan for a Senate run into doubt. Having once waged a lawfare campaign against his potential election adversary Lula da Silva, which kept the former president out of the 2018 election, Moro has himself now tried to claim that he is a victim of “lawfare”.

CNN reports that the Federal Audit Court (TCU) has shared with the Attorney General’s Office (PGR) documents about money received by Sergio Moro during his stint at the U.S. based Alvarez & Marsal law firm. Brasil Wire reported on his appointment to the firm in december 2020. The TCU also asked the Public Prosecutor’s Office (MPF) to rule on an immediate request for the blocking of Moro’s assets.

It is suspected that the former judge, who has extensive connections to U.S. government, intelligence and private sector, who was by then acting as lawyer after leaving the Bolsonaro government in 2020, received payments from companies that he had judged, condemned, and endorsed leniency agreements for, via Alvarez & Marsal. It is as yet unclear as yet how much of the R$40 million in payments from the Lava Jato convicted companies Moro received directly to his own accounts. It is not the first instance of kickbacks from the U.S. to those involved in Operation Lava Jato.

Federal Audit Court Minister Bruno Dantas has complained about efforts to impede investigation of payments Moro recieved: “I have no doubt that these are facts that need to be further investigated. And it is for this reason that I am surprised by a certain hasty action by any petitioner who intends to interrupt the natural flow of the process, even before the conclusion of the investigations. It is natural that those investigated want this outcome…”.

According to the Audit Court decision, Alvarez & Marsal “received around R$40 million from companies sentenced in Lava Jato, including R$1 million per month from Odebrecht e Ativos (former agro-industrial company), BRL 150,000 from Galvão Engenharia, BRL 97,000 from from OAS and R$ 115 thousand monthly from the Enseada Shipyard.”

Moro was hired by Alvarez & Marsal after leaving his post as Bolsonaro’s Justice Minister, having delivered the far right candidate Brazil’s presidency by his jailing of then frontrunner Lula. Upon moving to the United States and taking up the post as a managing partner in November 2020, Alvarez & Marsal announced  that Moro would join an unusual team, made up of former US intelligence and security agency employees, including former DOJ prosecutor Steve Spiegelhalter, retired FBI agent Bill Waldie, and Roberto De Cicco, who had previously worked at the National Security Agency.

Moro’s intervention in the construction and energy sectors in early 2015, bankrupting several of the companies who would later seek the assistance of Alvarez & Marsal, amounted to a manufactured economic crisis which, along with his own anti-corruption narrative, underpinned both the coup against Dilma Rousseff and election of Jair Bolsonaro.

He remained at the company, which had been hired for assistance in restructuring Lava Jato’s target companies, until he decided to launch his own presidential bid. In April 2021 Brasil Wire had reported how Moro, while at Alvarez & Marsal was taking part in secret negotiations between the U.S. government, Brazilian representatives and private sector over the future of the Amazon, despite the lawyer holding no publicly declared position or remit to do so.

It is suspected that companies he tried as a judge went on to make payments to him, via Alvarez & Marsal, once he was out of government. Moro always claimed that there was no conflict of interest is that he never acted for the companies he judged. Invoices listed by the Audit Court, however, cast doubt on his denials.

On these grounds, the Minister Dantas shared the findings of the Audit Court and left the question of blocking Moro’s assets for the Attorney General to decide.

“I order the sending of a full copy of these records to the Attorney General of the Republic so that he can examine the matter and, if he deems this the case, determine the measures for its investigation, as well as regarding the pertinence of the eventual blocking of assets claimed by the Public Prosecutor’s Office, of accounts”, said Dantas in the decision.

Moro’s press office has called for the investigation into the payments to be shelved.