Brazil’s Leader Linked to $6.5 Million in Graft : Government: A congressional report on corrupt activities could set stage for Collor’s impeachment.

In a report on corruption that could set the stage for impeachment, congressional investigators said Monday that President Fernando Collor de Mello’s household and family received $6.5 million from a ring of grafters and influence peddlers linked to his administration.

The report said evidence against Collor, 43, is “incompatible with the dignity, honor and decorum of the position of chief of state”--grounds for impeachment under Brazilian law.

A joint congressional committee that investigated corruption for more than 80 days is scheduled to formally approve the report on Wednesday. Then, perhaps as early as Friday, the Brazilian Assn. of Lawyers plans to submit a formal request for Collor’s impeachment to the Chamber of Deputies, Brazil’s lower house.

Congressman Amir Lando, who compiled and drafted the report from the committee’s findings, presented the 200-page document in a committee meeting that was broadcast live by national television networks. The session lasted 5 1/2 hours.

The report’s tough assertions on impeachable offenses brought “Collorgate,” Brazil’s version of the Watergate scandal, to the boiling point. Within hours, tens of thousands of anti-corruption demonstrators gathered in the center of Rio de Janeiro demanding Collor’s impeachment.

Gov. Leonel Brizola, governor of Rio de Janeiro state and formerly a Collor ally, jumped on the impeachment bandwagon, saying evidence against the president made legal proceedings against him inevitable.

As compromising evidence emerged, Collor’s political support has dwindled rapidly in recent weeks, and public demonstrations against him have grown. A recent public opinion survey said that 70% of those interviewed wanted him out of office.

A poll of the Chamber of Deputies published Monday by the newspaper Folha de Sao Paulo listed 254 members favoring impeachment, 34 against and 215 undecided. Collor needs the support of 168 members, or one-third of the chamber, to block impeachment.

The Monday report will not help him. Although the committee’s key findings had previously been leaked to newspapers, the complete document painted an extensive, detailed and disconcerting picture of corruption since Collor took office in March, 1990.

The report said that Paulo Cesar Farias, Collor’s presidential campaign treasurer, nicknamed “PC,” had organized an illicit financial network that used Farias’ connection to Collor to squeeze illegal “commissions” from companies seeking to do business with the government. As a result, Farias enjoyed a “spectacular” increase in wealth, according to the report.

The network moved illicit money around in “phantom” bank accounts that the report said were part of the “PC scheme” run by Farias. Although the names on the accounts were fictitious, some of their addresses were the same as those of a Farias company, and handwriting experts said Farias’ secretary signed many of the checks.

Checks for a total of $6.5 million went for improvements on Collor’s residential properties or to accounts controlled by Collor’s personal secretary, his wife, his wife’s secretary, his former wife and his mother, the report said.

According to the report, Ana Acioli, the president’s personal secretary, received $2.4 million from phantom accounts and used it to pay household expenses in Collor’s private mansion in Brasilia. The secretary of Rosane Collor, the president’s wife, received $596,000 directly from EPC, the Farias company.

Claudio Vieira, Collor’s former private secretary, has said that money for the president’s household expenses came from an unused campaign loan made to Collor by a Uruguayan firm. But the committee report said evidence shows Vieira’s claim to be false, and it accused Vieira of being part of the “PC scheme.”

“It is concluded, therefore, that the nexus between the ‘PC scheme’ and the president of the republic emerges precise and remains complete,” the report said. It said Collor knew that Farias was using the president’s name to commit crimes but did nothing to stop it because of the large amounts of money that Farias was providing.

“It has become evident that the president of the republic, permanently and during more than two years of his term, received undue economic advantages . . . directly or indirectly from Mr. Paulo Cesar Cavalcante Farias,” concluded the report.

If Collor were impeached for common crimes, he would be tried by the Supreme Court. If he were impeached for a “crime of responsibility” in failing to uphold “public morality,” he would be tried by the Senate.

In either case, impeachment would automatically suspend him from office for 180 days pending the trial.

No president has ever been impeached in Brazil, which borrowed the legal concept from the American Constitution. But some of Collor’s opponents predict that the first impeachment is coming.

Others say that the erosion of Collor’s power, resulting from the scandal and the threat of impeachment, may force him to resign.

“The president is there, but he no longer has political life, he doesn’t have decision-making power,” said Sen. Fernando Henrique Cardoso, a Social Democrat.

“I see as unlikely any conclusion other than impeachment or resignation,” said Sen. Eduardo Suplicy, a member of the leftist Workers Party.

But Sen. Ney Maranhao, a leader of Collor’s right-wing National Reconstruction Party, predicted that the president’s allies will win a vote on impeachment. “We are waiting for it to come up in the Chamber of Deputies to stop this thing immediately,” Maranhao said.

He said the impeachment movement was a “coup” plot by Collor’s leftist enemies, and he compared it to attacks on George Washington when the first U.S. President proposed moving the U.S. capital to the banks of the Potomac River.

“They called George Washington a robber,” Maranhao said. “The president is clean. The president is the George Washington of Brazil.”

Farias, in a telephone interview with Brazil’s SBT television network, said the committee’s investigation was political and unjust. And he denied any “link between me and the president.”

BACKGROUND

Fernando Collor de Mello . . . Born Aug. 12, 1949, into a wealthy, conservative family of Alagoas, a small, sugar cane-growing state in northeastern Brazil . . . Graduated in economics from the University of Alagoas and did post-graduate work at the University of Brasilia . . . Joined his family’s media empire (Alagoas’ largest newspaper, a television station and 13 radio stations), becoming president of the group in 1978 . . . Appointed mayor of Maceio, the state capital, in 1979 . . . He was a member of the Brazilian Chamber of Deputies from 1982-86 and governor of Alagoas from 1987-89 . . . Founded the National Reconstruction Party in 1989 as a vehicle for a presidential campaign that he won later that year . . . Took office as Brazil’s 35th president in March, 1990--at 40, the country’s youngest chief of state . . . Married to Rosane Malta, his second wife. He has two sons by his first marriage to Lilibeth Monteiro de Carvalho.