Arantes (2011b) argues that the repressive control of political corruption promoted by the Public Prosecution Service in Brazil went through a double shift during the 2000s. First, there was an emphasis on the state sphere that used civil mechanisms (public class action suit and civil investigation); then, there was a concentration of efforts at the federal level through significant criminal operations, comprised of greater articulation between the three institutions involved (PF, MPF and Federal Justice). One may say that this arrangement found its culmination in Operation Lava Jato. The strategic action of the Federal Judiciary was essential for the results achieved, notably in the central unit of Curitiba. Noteworthy are the ad hoc changes in the state capacity of the courts responsible for the operation; judicial decisions with concealment of information that could move the case to another court; and the selective streamlining of cases, according to the selected priority of the defendants to obtain cooperation agreements that would lead to political actors being held accountable, with the former President Lula as the main target (Rodrigues, 2020). Despite the relevance of this strategic action for the production of results, including and especially making Lula's candidacy in 2018 unfeasible, there is a history of institutional development of the Federal Justice that was also essential for Lava Jato, of which we highlight: a significant increase in the number of local courts, which rose from about three hundred in 1996 to almost a thousand in 2016; specialization of judicial units focused on the significant white-collar crimes (money laundering and crimes against the national financial system); substantial investments in the qualification of human resources; and progressive implementation of technological tools for optimization of judicial activities, such as fully electronic proceedings and software for online fulfillment of court orders aimed at producing evidence (Rodrigues, 2020). These technological advances have led to more efficiency in tracking the resources of complex financial operations that are usually associated with white-collar crimes. This process brings to the scene three institutions that have cooperatively integrated into the flow of investigation and punishment of these crimes: the Control Council of Financial Activities (Coaf), the Federal Revenue of Brazil (RFB), and the Department of Asset Recovery and International Legal Cooperation (DRCI).

Coaf was created in 1998 and, as the Financial Intelligence Unit of Brazil, produces intelligence reports disseminated to various national accountability agencies. It also compiles relevant financial data from communications made by multiple entities, public and private, which are part of sectors usually used in money laundering. Despite the lean administrative structure, its reports have been essential for tracking surreptitious financial transactions that lead investigators to the illicit assets of people and companies involved in the practice of corrupt acts. Table 4 shows the amount of exchange information between Coaf and other agencies in the country, from 2003 to 2019, while Fig. 3 shows the number of Finance Information Reports (RIF) produced and propagated annually by Coaf in the same period. This data can be considered a good indicator of close cooperation aimed at screening suspicious financial transactions and thus the possible increased costs associated with the practice of wrongdoings by covert financial mechanisms. One should note that, in 2019, eighty-three percent of the total exchanges were carried out with the police and prosecution' service.

The RFB generally escapes the radar of academics who dedicate themselves to studying the accountability institutions focused on combating corruption, which is explained due to its institutional mission aimed at the Union's tax and customs administration activities. As it occupies a central role in the financial activities related to raising public revenue, the federal government has promoted constant investments in the institution, ensuring effective tax collection. One should highlight the technological advances for more accurate taxpayers' records, tax

**Table 4** Amount of information exchange between Coaf and other agencies (2003–2019)

Source: Adapted from table 4 of Coaf (2020, p. 25)

intelligence, and service agility (Ezequiel, 2018). It is important to notice that, in 2009, OCDE approved a recommendation to strengthen the role of tax authorities against bribery (Recommendation on Tax Measures for Combating Bribery of Foreign Public Officials in International Business Transactions). Recommendations are non-binding legal instruments, but compliance with their provisions is subject to pressure by the OCDE assessment system and may be required as a condition for entry as a member, a claim made in May 2017 by Brazil, which has the key partner status since 2007 (Thorstensen & Nogueira, 2020).

Two critical elements help to explain the relevance of the RFB in the control of illicit activities that involve corruption and embezzlement of public resources but remain unnoticed in some analyzes on the accountability institutions (Power & Taylor, 2011; Prado & Carson, 2014; Machado & Paschoal, 2016). Firstly, the agency is part of the country's list of anti-money laundering institutions, with an explicit provision for prevention activities in the institution's bylaws. The RFB

**Fig. 3** Amount of Financial Information Reports (RIF) produced by year. *Source:* Prepared by the author, based on Coaf (2011, 2020)

occupies one of the eleven seats in the Coaf plenary session, is part of the Integrated Management Office of Enccla, and participates in the National Network of Anti-Money Laundering Technology Laboratories—REDE-LAB, which will be discussed below. Moreover, the Complementary Law 105 / 2001, allowed the RFB direct access to taxpayer's bank transitions without relying on a court order, as is the case in investigations carried out by police and public prosecutors. This shortcut to carry out global financial analyses, with tax and banking data, gives the RFB a competitive advantage, which helps explain its active participation in significant police operations, being present even in the press conferences held by Lava Jato investigators.

The annual report on the activities carried out by the RFB in 2019 confirms that it operates even before the ostensible phases of the operation, "through crossings and analysis of internal data carried out by the investigation sector" (Brazil, 2020a). Cooperation with criminal investigation agencies also led to the development of Sislava, a data management software for processing and analyzing information shared by criminal justice system. In 2017, there were more than 3.5 million pages of documents containing information on 58.7 thousand people and companies (Brazil, 2017). The RFB also formalized special inspection teams to act in other large police operations: Zelotes, which investigates frauds committed by lawyers and companies within the scope of the Administrative Council for Tax Appeals (Conselho Administrativo de Recursos Fiscais—Carf); Calicute, which has as its object the deviation of resources in the management of the government of the state of Rio de Janeiro; and Greenfield, which investigates pension fund fraud (Brazil, 2020a).

The activities of tracking illicit resources that move through more sophisticated financial networks also count on the relevant performance of the DRCI, created in 2004 under the Ministry of Justice. Among its primary functions, the DRCI coordinates the agencies involved in combating money laundering and transnational organized crime, especially the recovery of assets and acts of international legal assistance in criminal matters. The agency exercises central authority functions in almost all international legal assistance agreements and treaties signed by Brazil.5 Intermediation in carrying out acts of international legal assistance allows procedural steps such as depositions and arrests. It also allows the search for evidence of illicit behavior that leaves traces abroad, notably deposits held in bank accounts undeclared to the Brazilian authorities. In 2004, the agency brokered 780 requests for international assistance and 2,439 in 2018. Table 5 shows the values repatriated through the DRCI since 2007, indicating the police operation they refer to (eighty percent of them at the federal level) and the countries involved in the cooperation.

In addition to the essential brokering of requests for international legal assistance, the DRCI hosts the Anti-Money Laundering Technology Laboratory (LAB-LD), created in 2007 to overcome difficulties encountered in money laundering and corruption investigations in the analysis of the large volume of banking, tax, and telephone information. The laboratory works as a model to develop and disseminate the best technological and training practices. This model was replicated to other federal and state agencies in 2009, with the National Network of Technology Laboratories (Rede-Lab), which in 2019 possessed 58 units in operation and five in installation phases (Brazil, 2020b). The network's laboratories analyzed more than seven thousand cases with traces of illegality between 2006 to 2017 (Brazil, 2018), which materializes a background activity that reinforces the effectiveness in producing more solid evidence about complex financial tracings.

5 International cooperation agreements and treaties provide that the Ministry of Justice occupies the role of Brazilian central authority, but this function is exercised by the Department of Foreigners in requests for extradition and transfer of convicted persons, and by DRCI in other cases. There are two exceptions to cooperation in criminal matters, which envisage the Office of the Prosecutor General as the central authority: bilateral treaties with Portugal (Decree 1.320 / 94) and Canada (Decree 6.747 / 09).

**Table 5** Repatriation intermediated by DRCI (2007–2018)

The control of the legality of acts performed by public officials is not limited to that exercised by the justice system since various organs of the federal structure have their departments of internal affairs. Moreover, since 2003, the federal anti-corruption agency, the Office of the Comptroller General (CGU), began its operation. The CGU reorganized the internal control of the federal administration by making it centralized and started to include activities to promote the quality of public management and monitor national public policies carried out by subnational entities with federal funding.

CGU's mission is to promote the defense of public assets, prevent and combat corruption, and increase management transparency in the federal area by establishing investigations and administrative proceedings or, as the case may be, by pressing charges to the competent authorities to investigate the omission of public officials. Also noteworthy is the innovative function of inducing and strengthening social control through the participation of civil society (Loureiro et al., 2012). Figure 4 shows the number of special operations conducted by the CGU

Source: Prepared by the author, based on DRCI reports and the MPF website

**Fig. 4** Special operations conducted by CGU (2003–2019). *Source:* Prepared by the author, based on CGU (2020)

in partnership with other agencies, federal and state, with their calculated potential losses, which gives an idea of the importance of his role in determining unlawful at the expense of public funds.

The CGU gained even more relevance after the entry into force of Law 12,846 / 2013, known as the Anti-Corruption Act or Clean Company Act. In addition to providing for administrative and civil liability of companies for acts committed against public administration, both domestic and foreign, this law introduced the leniency agreement for the offenses provided for in the law. It also made CGU responsible for celebrating this agreement within the scope of the Federal Executive Branch. These agreements have become an essential tool for identifying those responsible for wrongdoings that are harder to determine and as a means of imposing more efficient compliance mechanisms in the structure of large corporations.

When it comes to leniency agreements in Brazil, one must highlight the Administrative Council for Economic Defense (CADE). Since 1994, CADE has gained status as a federal autarchy linked to the Ministry of Justice, with structure and instruments that allowed it to exercise more effectively the protection of free competition in the market. It carries out its mission through different kinds of activities: preventive, when deciding on mergers and other acts of economic concentration that may affect free competition; repressive, in the investigation and punishment of the practice of cartels and acts harmful to free competition; and educational, through various activities in a civil society focused on the subject of free competition. The main bridge connecting CADE to the other branches of the anti-corruption institutions is the close connection between the practice of cartels6 to circumvent the competitive principle of contracts signed with the government and corruption pacts in the execution of these contracts. This spurious symbiosis appears in the main charges filed by Lava Jato prosecutors and marks the first antitrust leniency agreement entered into in the operation, in partnership with CADE and the MPF. This first agreement narrated the anti-competitive behaviors involving at least 23 companies, practiced in the industrial onshore assembly works market in Petrobras' tenders, which would have lasted from the late 1990s until at least the beginning of 2012 (CADE, 2015).

Figure 5 shows the history of leniency agreements concluded by CADE, highlighting those that are part of Operation Lava Jato. Since the early 2000s, there are leniency agreements concluded by CADE, but only involving anti-competitive practices, since the leniency linked to corruption was only introduced in August 2013 (Law 12,846). One should note that there was already a growing use of the institute. Still, there is a significant increase after Operation Lava Jato, partially explained by the institutional proximity established between CADE and the MPF, since the first antitrust leniency agreement. This joint experience even guided the role of the MPF in modeling the anti-corruption leniency agreement (Pimenta, 2020).

Finally, mention should be made of the Federal Court of Accounts (TCU), which also is part of the list of institutions that monitor, inspect, and punish deviant behavior of public authorities. Besides occupying the role of auxiliary agency of the National Congress in monitoring the budget and financial execution, TCU performs the external control of the federal government through various competencies. These competencies include the supervision of compliance with federal funds passed on to sub-national entities; the application of sanctions and correction of illegalities practiced by public and private agents who manage the federal assets and resources; and the judgment of the accounts rendered by managers or those responsible for the custody and use of federal public resources. The studies on the performance of accountability institutions in the country usually emphasize that TCU is one of the strongest institutions among its Latin American counterparts. Despite imposing reputational costs to politicians, with repercussions on the elections' results (Pereira & Melo, 2015; Winters & Weitz-Shapiro, 2013), the TCU audits are technically rigorous. However, it has weak enforcement of penalties, primarily because they depend on political and

6 Cartels, punished as an administrative infraction and as a crime by Brazilian law, can be defined as agreements between competitors to adjust prices, offers, divide markets, and other variables that may have relevance in market competition (Laws 8,137 / 1990 and 12,259 / 2011).

**Fig. 5** Leniency Agreements concluded by CADE (2003–2019). *Source:* Prepared by the author, based on CADE (2020)

legal institutions in subsequent phases, with coordination and cooperation deficits between institutions (Speck, 2011; Taylor & Buranelli, 2007).

Unlike what is observed concerning other agencies described in this section, some evidence suggests that there has not been a harmonious and cooperative integration of TCU in the investigations related to Operation Lava Jato. The institution is not even mentioned in the main portal to disseminate the operation results (MPF, 2020a), which possibly expresses the little acknowledgment of TCU's performance in assessing unlawful at auctions held by Petrobras. This is confirmed by the existence of only one charge of fraud in public bids until December 2018 by the nucleus of Curitiba.

In addition, some Lava Jato investigations reached members of TCU, which may have reduced the trust and accentuated tensions between the institutions, as observed by the following events: i) the investigation before the Supreme Court involving the ministers of the TCU Raimundo Carreiro and Aroldo Cedraz, the latter formally accused in October 2018 (case No. 4075); ii) the charge filed by the MPF in Curitiba against the former Senator and now Minister of TCU Vital do Rego Filho, who allegedly received R\$ 4 million in bribes as Senator and President of the CPI of Petrobras (action n. 5,041,210–45.2020.4.04. 7000); iii) the charge filed by the MPF in Rio de Janeiro about corruption involving TCU auditor Cristiano Albuquerque and the influence peddling against several lawyers hired on the pretext of influencing decisions at TCU (action n. 5,053,463–93.2<IP_ADDRESS>01); iv) the Office of the Comptroller General obtains an injunction from the Supreme Federal Court preventing the compliance with the TCU decision determining that all information on leniency agreements conducted within the scope of the Lava Jato were to be sent to TCU (procedure n. 340,031); v) an investigation initiated by TCU to assess the dimension of the parallel budget administered by the MPF due to agreements signed (case records 007.597 / 2018–5); vi) a proceeding initiated by TCU to investigate the alleged irregular purchase of telephone interception equipment by the Lava Jato task force in Curitiba (case no. 025.306 / 2020–0).

This diagnosis finds confirmation in the content of messages that have been exchanged between the members of the task force Lava Jato, obtained by hackers and published by the media under the name "Vaza Jato" (Leak Jet). Despite doubts concerning the content's authenticity, an excerpt referring to the suspicion deposited on the TCU is transcribed in a conversation that allegedly occurred on April 17, 20167 :

Júlio Marcelo (Federal Prosecutor at TCU): My friend, if Gim Argello is going to whistleblow, I would like to make a suggestion/request: include with detail and evidence the TCU ministers. Certainly, Vital do Rego played a vital role in Petrobras' CPI so that it would come to naught, but I suspect that they both had essential articulations at TCU (Cedraz, Nardes and Carreiro, with the participation of Tiago Cedraz and/or Carlos Juliano Nardes).

Deltan Dallagnol (coordinator of the Lava Jato task force): We need to clean up the TCU. TCU's role is too important for it to be infiltrated by bandits. I remember that Nardes supported the departure of Gim Argello to TCU and only changed sides down to the wire.

Except for these more nebulous facts involving TCU, one can say that in recent decades, Brazil has undergone a progressive strengthening of corruption control institutions, which goes beyond the triad traditionally involved with the large police operations that have become routine in the country. There is also a growing integration of other contributing agencies, each with its expertise and focus of action, with the exposure of the intricacies of non-republican practices in the management of public assets and collective interests. On the other hand, Lava Jato shows that the strengthening of these bureaucracies comes up against questions about the legitimacy, limits, and control of anti-corruption institutions, especially

7 See Veja Magazine. Available at: <https://veja.abril.com.br/blog/radar/em-mensagens-pro cçador-chama-ministros-do-tcu-de-bandidos-infiltrados/?fbclid=IwAR1cX5Gh9qgwb1ZS MgGCVYk5FwRfd5lc\_viR0mMHz11-\_. Accessed on September 13. 2020.

when their activities advance to influence electoral competitions or contribute to the delegitimization of party politics, with damaging reflexes for the functioning of democracy.

#### **4 More Rigorous Punishment and Improvement of Investigation Tools**

Brazilian legislation has undergone a progressive hardening of the politicalelectoral consequences resulting from a criminal conviction. Since 1984, sentences exceeding four years for crimes committed with abuse of power or violation of duty towards the public administration entail the loss of public office and elected mandate. This four-year baseline was reduced to one year in 1996, when the electoral legislation from 1990 was already in force, which established ineligibility, for three years, as a consequence of the definitive criminal conviction for several crimes, including crimes against the public administration and the financial market. In 2010, this legal text was hardened, imposing ineligibility for eight years in convictions involving a long list of crimes, in addition to anticipating these effects to the decision rendered by a judicial panel, even without judgment on all instances.

The legislation has also toughened the punishments for corruption, money laundering, and organized crime, which can be considered the main charges of the central core of Lava Jato. Table 6 shows the main laws, the changes promoted and the politicians involved in their approval, highlighted in bold those that were later affected by Lava Jato.

In 2003, the penalty for corruption was increased from one to eight years to two to twelve years. On the same occasion, the duty to repair damages caused by crimes against the public administration was also imposed as a condition for the progression of the regime.8 The overall effectiveness of criminal sanctions was increased in 2010, eliminating one of the statutes of limitations instances. The advances on the assets of people involved in acts of corruption and money laundering also stand out in the legislative changes between 2012 and 2013. These advances refer to the blocking of lawful assets equivalent to the benefit of crime;

8 The sentence of liberty deprivation is characterized by the length of incarceration and the initial regime of its serving, which can be closed, semi-open or open. These regimes differ by the type of establishment where the sentence must be served and by the rigor imposed on the prisoner. The sentences are served progressively, allowing the transfer to a less severe regime, which depends on the merit of the convicted and the fulfillment of a fraction of the sentence in the most severe regime.

**Table 6** Main laws related to criminal anti-corruption operations (2000–2014)

(continued)

Source: Prepared by the author

the express authorization to block goods of illicit origin in the name of interposed persons or stooges ("laranjas"); and the maintenance of blockages even with proof of the lawful source of the assets, in amounts sufficient to compensate the victim and to pay the economic obligations fixed in case of conviction. These changes not only lead to asphyxiation of the financial flow that is expected to exist in contexts of systemic corruption or organized crime, but somehow increase the costs associated with the practice of illegal acts, since the blocking measures are enacted in the investigation phase or at the beginning of the criminal action, before the rigorous procedure of verifying the guilt of those involved. As an example, Odebrecht executives, including its president at the time, were the target of a judicial measure to block bank accounts in the amount of twenty million reais, which took place about a month before the first indictment against them.

Brazil criminalized acts of money laundering only when the resources were the product of a closed list of offenses, which changed in 2012 when the list was removed, extending the criminalization of concealment of gains derived from criminal enterprises. The following year was marked by the expansion of the criminal association crime, which instead of four started to require a minimum of three participants. Besides, a criminal organization started to be considered under the terms of the Palermo Convention, accompanied by the provision of a comprehensive list of investigative measures, including controlled action, infiltration of agents, and more comprehensive regulation of the cooperation agreements, which can be considered the apple of the eye of Operation Lava Jato.

The award-winning collaboration ("delação premiada") is one of the bargaining institutions introduced in the Brazilian legislation by Law 8,072 / 1990, which regulated the possibility of sentence reduction for a criminal association member. The benefits may be granted to those who confess and divulge their accomplices involved in heinous crimes, allowing the dismantling of the association. The same institution was later provided on several legal texts regulating specific criminal situations perpetrated by a group of people, namely: crimes against the financial system and tax order (Law 9080 / 1995); extorsion through kidnapping (Act 9269/1995); crimes committed by criminal organizing (Act 9034/1995); the money laundering (Act 9613/1998); the law that regulates protection of victims and cooperating witnesses (Law 9807 / 1999); drug trafficking (Law 11,343 / 2006); crimes against the economic order and cartel practice (Law 12,529 / 2011); and environmental crimes (Law 12,651 / 2012).

The actors in the criminal justice system had already made use of the cooperation agreement involving crimes of corruption since at least 2003, when the first plea agreement was signed in the country, within the scope of the Banestado Case,9 making use of the law to protect victims and cooperating witnesses. Controversies over the possibility of widespread use of the agreement were closed in 2013 with the law on criminal organizations (Law 12,850), introduced in the same year the so-called anti-corruption law (Law 12,846) was passed. This law provided for civil and administrative punishments to companies that practice acts related to corruption, in addition to introducing the leniency agreement on these issues.

The coexistence of cooperation agreements from the criminal area with the leniency agreements of the anti-corruption and the antitrust laws, which are essentially civil and administrative, started to generate some conflicts between the agencies of accountability. These conflicts exist because the leniency agreement can exclude the possibility of filing criminal charges against those who sign it. Still, the law is unclear on how to share the control of institutions that operate in different fields. Besides, it is expected that people and companies interested in concluding a cooperation agreement are also interested in ensuring that the facts described are not used to impose other sanctions beyond those already agreed upon, a possible setting considering the independent and concurrent action of the institutions of the accountability in the country.

9 The Banestado case had as its object investigations and related criminal actions the alleged illegal transferences abroad of more than US \$ 120 billion, of which approximately 24 billion would have been transferred through the use of non-resident accounts (called CC5) held in several banks, but especially at the Banco do Estado do Paraná (Banestado). The case was processed in the Federal Court of Paraná and was also conducted by Judge Sergio Moro, in addition to the participation of some members of the Federal Prosecutors Service who later joined the Lava Jato task force.

The Odebrecht case illustrates this trajectory of inter-institutional conflicts derived from the multi-agency anti-corruption system. The company's executives met with the swift and rigorous action of the criminal justice system, in addition to the pressure exerted by Citibank in the USA, threatening to block the company bank accounts in the country, due to the application of the FCPA. Faced with little success in court contesting the charges and arrest warrants, in December 2016, the Odebrecht Group agreed to simultaneous leniency with Brazilian, North-American, and Swiss authorities, followed by almost eighty cooperation agreements signed by executives of the group's companies. The Brazilian leniency agreement only counted on the participation of the MPF, which led the Attorney General's Office (AGU) to successfully challenge the legitimacy of the MPF (case no. 5 023,972–66.2017.404.0000). This challenging took the company to a new negotiation process that culminated in signing a leniency agreement with CGU and AGU that provided for the payment of indemnity equivalent to R \$ 2.7 billion (CGU, 2018). The TCU entered the dispute, requesting the suspension of negotiations on the Brazilian agreement signed by Odebrecht, for alleged violation of Normative Instruction 74/2015, produced by TCU itself and which attempted to introduce the mandatory participation of the agency even in the negotiation phase (TC file 035 857 / 2015–3). TCU judged the request for suspension unfounded, but the general dispute entered the judicial and legislative arenas. This dispute generated the questioning of the legality of TCU's normative instruction before the Supreme Court (Direct Unconstitutionality Action n. 5294); obtaining a preliminary injunction from the STF to suspend a decision by the TCU that obliged the CGU to provide information on all ongoing leniency agreements (writ of mandate n. 34,031); and the edition of Provisional Measure no. 703/2015, which lost its effectiveness for lack of approvement by Congress and which provided that the agreements would only be sent to TCU after conclusion and signature.

The process of accommodating institutional disputes over leniency agreements took another step forward with the Technical Cooperation Agreement on the subject signed by the AGU, CGU, TCU, and the Ministry of Justice, on August 6, 2020, with the participation of the Supreme Federal Court. This agreement came at a time of great conflict in the political arena over the direction of Operation Lava Jato, with disputes over narratives about the legitimacy of the criminal justice system's role in fighting corruption. This dispute possibly explains the lack of participation by the MPF in the Cooperation Agreement, which led the institution's Anti-Corruption Chamber to publish a technical note. It questions several points of the agreement, highlighting the depletion of the MPF's role in these agreements (MPF, 2020b). Although the trajectory of interinstitutional conflicts associated with leniency agreements has not ended, it can be said that the competition among the accountability agencies has not prevented its use by some companies, as can be seen in Table 7, which shows the leniency agreements signed by CGU until August 2020, when there were another twenty-two under negotiation. The two reimbursement columns refer to the total amount provided for in the agreements and the amount paid up to August 2020 due to clauses on installment payments.

Leniency and cooperation agreements enable the discovery of illicit facts that would otherwise be difficult for the authorities to know. They also enable the introduction of more stringent compliance mechanisms in the companies' structure since integrity programs are taken into account in calculating penalties. The first leniency agreement signed by Odebrecht, for example, was responsible for

**Table 7** Leniency agreements signed by CGU (until August 2020)

Source: Prepared by the author, based on CGU website

the significant increase in the work of the Lava Jato task force in Paraná. This signing led to creating an Agreement Management Unit (Unidade Gestora de Acordo—UGA) to oversee the more than 250 facts narrated in more than a thousand pages of agreement related to illegal activities practiced in at least eleven countries besides Brazil (MPF, 2020c).

It is crucial to note that the importation of these negotiated justice instruments, typical of the North American common law, has generated intense debates in academia and the legal community, with criticisms that point to their inadequacy to the country's legal culture, generally associated with the already high incarceration rate of the poorest and most vulnerable population, as well as the lack of control over the exercise of the discretion of the Public Prosecution Service.

One should note that the progressive advancement of technological tools has greatly facilitated the investigation of illicit activities related to corruption and money laundering. The changes include the progressive digitalization of court proceedings, fully electronic since 2010 in the Federal Court responsible for the main core of Lava Jato, and the development of several software programs that allow online enforcement of court orders, such as the blocking of resources held in financial institutions (2001), obtaining tax data (2008), and blocking vehicles (2008).

Last but not least, in parallel with this process of institutional advances promoted by the political class itself, the Supreme Federal Court has contributed on its own initiative to shape the anti-corruption institutional design. One can observe this modeling activity when the Court formulates new paradigms deciding concrete cases involving high-level corruption, as occurred in the judgment of Mensalão. It also occurs when the STF carries out new interpretations of the Constitution in subjects that can decisively influence the outcome of significant investigations underway. In Mensalão trial, we can say that STF expanded the possibilities of criminal liability of high-ranking authorities by developing a theory of position domain (Leite, 2014), appropriating in a very criticized way the Theory of Final Domain of Fact developed by jurist Claus Roxin.

STF also acted strategically in two opposing scenarios related to Lava Jato. In the first moment of support for the operation, the Court exercised no veto activity over almost any aspect of the performance of the actors of the Lava Jato main unit. One can see this support by looking at the low number of preventive arrests decisions overturned by the STF and, especially, by the change in the constitutional interpretation of the presumption of innocence. Reviewing its position adopted in 2009, in 2016, the Supreme Court started to authorize the execution of the sentence before the judgment of all appeals, even without the decree of preventive detention (called prison before the res judicata). The change possibly contributed to the results of Lava Jato, as the prospect of anticipating the beginning of the execution of the sentence encourages the search for collaboration agreement, especially given the strategic time management in the processing of actions in the main core of Lava Jato (Rodrigues & Arantes, 2020).

Still in a scenario of strong public support for the operation, in May 2018, the STF remodeled the constitutional interpretation of the "privileged forum". The Court significantly restricted the cases of authorities with the prerogative to be prosecuted before the Collegiate Courts, transferring this jurisdiction to first instance judges. The measure has an immediate effect on reducing the political exposure of the Collegiate Courts, specially the STF, which exercised criminal jurisdiction over several federal authorities. It also has the potential to encourage the protagonism of the lower levels of the justice system through police operations against political agents. This institutional modeling is still ongoing in the Court, which maintained the privileged forum in some cases of crossed mandates in a trial in May 2021 (procedure No. 4846).

In a scenario in which Lava Jato became the target of more intense criticism, with its image tainted when ex-judge Sergio Moro assumed the position of Minister of Justice in Jair Bolsonaro's government, the STF restricted the competence of the Federal Justice, in March 2019, by excluding it in cases of corruption that are associated with an accusation of electoral crime. The Court also resumed the previous position of prohibiting the execution of the sentence before the final decision (*res judicata*), but it did so only in November 2019. Here there was a deliberate choice not to rule the judgment of this constitutional issue when the STF maintained the arrest of the ex-president Lula, in April 2018. In this instance, there was already a majority formed on the thesis that would have prevented his imprisonment for 580 days, derived from a conviction later overturned in two STF collegiate trials. These trials recognized the partiality of Judge Sergio Moro (March 2021) and the incompetence of the Federal Court in Paraná (April and May 2021).

The actors and institutions involved with Lava Jato used the incremental process of improving the mechanisms for controlling corruption and the institutional loopholes that make their activities less accountable. Although this institutional dimension was not sufficient for the operation results, it is difficult to deny that it will continue to impact the strategic choices of politicians and businesspeople operating in the country, as well as modulating the incentives and constraints of control bureaucracy.

#### **5 Final Considerations**

The data presented in this chapter provide a general map of the institutional design that was built and remodeled in Brazil in the years preceding Operation Lava Jato. This design shows the scenario in which businesspeople and politicians decide their strategies on establishing economic relations that interconnect private interests and public morality and resources. Brazil assumed international commitments to fight more effectively not only the practice of corruption but mainly the acts of occultation and concealment of assets from illicit sources. These commitments were internalized by the approval of more rigorous legal rules, strengthening of control institutions, intensification of international legal assistance and domestic inter-agencies cooperation, in addition to the improvement of mechanisms for monitoring the traces left by illegal financial activities.

These incremental advances can make the practice of some types of corruption more costly insofar as they provide signals about the political costs of being involved in the practice of some corrupt behaviors (Levi, 1999). They mainly alter the incentives and constraints imposed on the actors, which possibly occurs in parallel with the reshuffling of the behavior of politicians and businesspeople to enable the realization of their interests. It is also important to highlight that a broader definition of corruption does not only include the traditional exchange relationship (*quid pro quo*) between a public agent and a private agent. This definition also covers several less explicit forms of appropriation of public assets using direct or indirect relations with people in positions within the state structure. These may refer to institutional characteristics of the relations between the State and economic agents, which will not always be subject to the control mechanisms developed in recent decades. In addition, one cannot disregard that the engagement of accountability institutions and the patterns of interaction between them are also a reflection of self-interested movements, aimed at the search for institutional affirmation and preventing their activities from being subject to accountability (Arantes & Moreira, 2019).

The institutional framework summarized in this chapter and the specific issues related to Lava Jato show the complexity of political relations that drive the country's anti-corruption and anti-money laundering institutional design. On the one hand, the progressive strengthening of control institutions involves an apparent paradox since the political class promoted most of these advances. There were politicians affected by Lava Jato who played a decisive role in the legislative process described in this chapter. On the other hand, the interests that drive the members of the control bureaucracies are not very clear. They secure personal, institutional, economic and reputational gains from the strengthening of the accountability mechanisms of the political class. There is also little certainty to affirm that the centrality given to the anti-corruption policy by the criminal justice route adopted by Lava Jato has some effect of discouraging corruption in the future. However, it seems reasonable to believe that the incremental process that preceded Lava Jato will continue to produce the impact derived from the constraints and incentives it generates, in addition to keeping open the possibility of intense activity of accountability institutions in the country, with all the consequences that the deficit of control over some of these institutions can produce on democracy.

#### **References**

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## **Rational Executives and Selfish Politicians: The Cultural Repertoires of Legal Experts**

Maria Eugenia Trombini and Elizangela Valarini

#### **1 Introduction**

Grand corruption affairs, and the arrest of politicians and high-ranking executives, has ignited the debate about the strategic action of law enforcers and the effects produced on democracy and political institutions. Other authors have already focused on the political uses of Law and the consequences of the fight against corruption in Brazil. But after all, what do legal professionals, working inside and outside the administration of justice, think about the people labeled white-collar criminals in the cases they sentence, accuse, and defend? The objective of this work is to advance the research agenda on the point of convergence between Law and Politics by shedding light on the action orientation of members of the justice system.

Rather than looking at the institutional design (Praça & Taylor, 2014; Madeira & Geliski, 2019; Kerche, 2018; Kerche and Marona 2022) or the interaction between agents within the accountability network (Castro & Ansari, 2017; Sadek, 2019; Oliveira et al., 2017; Engelmann & Menuzzi, 2020; Almeida, 2019; Sá & Silva, 2020), our gaze shifts to the actors and their cultural repertoires.

E. Valarini Alumni Max Weber Institute of Sociology, Heidelberg, Germany e-mail<EMAIL_ADDRESS>
M. E. Trombini Heidelberg Center for Ibero-American Studies, Heidelberg, Germany

83

M. E. Trombini (B)

Max Weber Institute of Sociology, Heidelberg, Germany e-mail<EMAIL_ADDRESS>
Using qualitative interviews with the group of experts on corruption and whitecollar crime, we will reconstruct the collective mindsets that underlie the actions of members of this professional complex. The objective problem of action, to which the interpretative patterns respond, is the relationship between the political and economic sectors. Collective mindsets are enunciated by judges, prosecutors, and lawyers with previous experience in corruption cases. By analyzing the worldviews held by this group our aim is to understand, focusing on the relationship between both sectors, where they locate the problem of corruption and who are its main participants in the Brazilian context.

Sources of empirical material are 24 in-depth interviews in which professionals experienced in major corruption scandals throughout Brazilian history (1985–2021) articulate ideas about the economy and politics. Our investigation of legal professionals' understanding of corruption and the links between the political and economic sectors uses the hermeneutic methodology of Collective Mindset Analysis (CMA). From the epistemological point of view, the stocks of knowledge acquired and built up by the various societies make it easier for the individuals within them to classify situations, problems, crises (Schütz, 1971), as for example the phenomenon of corruption. Mapping such knowledge stocks allows us to understand not only the meaning behind the actions of a given group, but also to identify in which institutions they are anchored.

After this introduction, the second section discusses the theoreticalmethodological choices, followed by the presentation of the results of the Collective Mindset Analysis (CMA). The third section introduces the Brazilian institutional setting, focusing on the anticorruption legal complex. Finally, the results are discussed in the fourth section and at the end research implications are outlined.

#### **2 Theoretical and Methodological Approach**

We know of the moral conception of legal practitioners in modern society (Karpik, 2007; Parsons, 1937, 1939), and that compared to other professionals such as doctors or engineers, lawyers have notable advantages in political mobilization given their ability to exercise moral authority in the name of technical competence (Halliday, 1985). An extensive body of studies labeled "political lawyering" (Karpik, 2007), has suggested that the affinities between jurists and individual liberties is a historical reality, but factors external to the professional *ethos*, such as a class logic, may anchor illiberal decisions by legal professionals (Couso, 2006). We enter the topic of the nexus between legal professionals, politics and the economy by following an agentic perspective on experts from the anticorruption complex.

The understanding legal actors have about the phenomenon of corruption, that is the worldviews they hold of the two poles involved, bribe-givers and bribe-takers, can only be indirectly accessed. Therefore, we will reconstruct the collective mindsets activated by the group under examination using qualitative interviews conducted for the purpose of applying this interpretive method (CMA) based on the social constructivism of Peter Berger und Thomas Luckmann (1967). The study's specific objective is to map on which set of available knowledge, beliefs, and value systems the actions of this subgroup are anchored. More generally, we aim to understand what stock of knowledge is activated in that particular society and context to interpret corrupt behavior. We may hypothesize that, as members of the legal system, the knowledge base and symbolic representations through which the group interprets laws are more uniform than the interpretations of others regarding the same symbols. Our investigation will look concretely at the narratives related to confronting corruption found among judges, prosecutors, and lawyers working in the Brazilian field. We will follow this question with the support of a method that enables to answer which cognitive and normative institutions are among the stocks of knowledge accessed by these agents to understand and locate the phenomenon of corruption.

Within and across institutional settings, including professions, discursive interaction forges meanings, values, commitments, and worldviews, providing individuals with a shared stock of knowledge (Schütz, 1971; Berger & Luckmann, 1967; Schütz & Luckmann, 2003), also understood as cultural repertoires. The existing literature on cultural repertoires typically employs the qualitative paradigm, such as in-depth interviews (Lamont, 1992), case studies (Ravasi & Schultz, 2006), content analysis of communications produced by a specific community (Weber et al., 2013). Drawing on more recent efforts to study repertoires, or collective mindsets, within a specific group (Valarini, 2018; Valarini et al., 2015; Valarini & Pohlmann, 2016; Elias, 2019; Klinkhammer, 2018; Höly, 2018) and a profession (Pohlmann, Höly & Trombini, 2022), and about the public–private (corrupt) relationship (Valarini, 2021), this study will apply the hermeneutic method of Collective Mindsets Analysis (original *Deutungsmusteranalyse*, denoted here by the abbreviation CMA) to interviews made with practitioners in the anti-corruption complex.

Ullrich Oevermann (2001a, b) originally developed CMA as a technique to study shared ways of understanding a phenomenon. The prerequisite for the emergence of patterns of interpretation, or mindsets, is an objective problem of action which is shared by individuals in a society or a sub-group in it. Faced with a specific circumstance, each individual uses socially available collective mindsets that offer appropriate, and thus reciprocally recognized, interpretations of the underlying situation. To allow ordinary or exceptional problems to be dealt with routinely, such patterns of interpretation attain the status of a stand-alone entity, existing independently of agency. In this paper, the action problem dealt with is corruption and where it is located according to the group studied. One of the advantages of the chosen qualitative method is that collective mindsets are relatively temporally stable contents of social knowledge accumulated in a society. This is because in order to deal with the different everyday spheres of interpretation and action of social phenomena and processes,1 societal groups and subgroups store, based on their biographical experiences, common ways of interpreting and evaluating a phenomenon or a situation. Such repositories of historical and social references achieve validity within that group and facilitate knowledge allocation, helping social actors simplify complex situations without having to interpret each situation as if it were unique (Meuser & Sackmann, 1992; Oevermann, 2001b; Sachweh, 2010). The manifestation of collective mindsets takes the form of derivations—explanations, justifications, and narratives about a fact, issue, phenomenon, etc.—when actors are questioned or asked to explain their actions, decisions, beliefs, etc. Thus, methodologically, it is not the collective mindset itself that is directly accessed, but the derivations, that is, the meaning, explanation and justification attributed to a specific problem (Ullrich, 1999). Our purpose with the qualitative analysis is to identify the "recipes" or guidance orientations containing unwritten rules that govern action within the societal group being studied (Bögelein & Vetter, 2019).

Our database for the qualitative analysis is comprised of 24 interviews conducted between 2017 and 2021 stratified by quotas of career, gender, and place of work (Appendix I). The choice of interviewees was based on the definition of experts by Meuser and Nagel (1989) so the specialists who are part of the field of action constitute the research object. Selection of interviewees was based on the

1 According to Alfred Schütz an individual experiences the social world, *Lebenswelt*, at the subjective level, in his cogitations within the world of everyday life, and at the level of social collectivities, apprehending relations symbolically and generating meaning interpretatively. The origin of the concept is found in the phenomenology of Edmund Husserl and that was used by Jürgen Habermas in his Critical Theory and system concept, "...it is the world of natural attitude, of the relationship between fellow human beings, of everyday existence, of the experience of common sense thinking, natural, social and cultural world, world of exchanges, therefore intersubjective, in which it is necessary to fundamentally understand those who are closer (the associates) and be understood by them" (Fioravante Garcez, 2014, p.75).

following criteria: (1) legal professionals: lawyers, judges, and prosecutors; who (2) have acted and/or were acting in cases of corruption and financial crimes, at the time of the interviews, whose relationships between the economic sector (executives and companies) and the political sector (politicians and parties) are or were in evidence; and (3) that the cases were being handled in the federal jurisdiction.

Although the status of expert is relational, since it depends mainly on the interest and research problem, it is attributed to the actors who have privileged access to information about the object, about specific groups of people, or even about decision-making processes (Meuser, & Nagel, 1989). Thus, experts within an organizational context, as is the case of the interviewees from the anti-corruption complex, are actors who have tasks, responsibilities, as well as unique experiences and knowledge acquired during their trajectory. The actors of the justice system interviewed for this work are understood as experts in the policy area of corruption and money laundering.

The interviews were conducted in Portuguese, recorded in audio and then transcribed using NVivo software and manually corrected. To analyze the qualitative material, the Collective Mindset Analysis analytical method developed by Pohlmann et al. (2014) was employed.

The selected text passages were analyzed by the authors, first individually and then jointly, to reduce subjectivity in the analysis. For the operationalization, different thematic text passages related to corruption and its main participants were coded using the MAXQDA software. Both specific questions from the questionnaire that had the purpose to prompt responses in this regard as well as text passages related to the research problem triggered without the direct stimulus were considered. The deductive-inductive process allowed latent structures of meaning and knowledge accessed by the interviewees to be found. Beyond theoretical assumptions that the group understands corruption as a phenomenon where economic and political participants are equally to blame, these latent structures, when systematically analyzed, provide more trustworthiness to our qualitative research.

Considering legal professionals as experts, we are assuming that their professional action would be guided by group-specific collective mindsets. Because the theoretical approach established that they wield influence in the anti-corruption complex, we also expect them to be playing a key role in the formation and diffusion of mindsets about corruption and its main participants. Against this backdrop, findings of the CMA method are explained drawing on neo institutionalism to explain the mindsets of Brazilian experts in light of other supporting

**Table 1** The eight steps for the Collective Mindset Analysis

structures. The search for knowledge and cultural repertoires activated by the group is part of steps 7 and 8 of the method (see Table 1).

In this chapter, we will present the justifications and narratives of legal professionals about corruption and its main participants.

#### **3 The Anti-Corruption Legal Complex in Recent Decades**

In the last decade Brazil has seen a strengthening of the institutional capacities of existing bodies and the creation and implementation of new ones with respect to fighting corruption (Da Ros, 2019; Rico, 2014; Speck, 2000). In the terminology of the Federal Public Prosecutor's Office, what exists is an anticorruption normative microsystem that encompasses several legal diplomas, disciplining the legal consequences of corrupt practices, notably state sanctions produced in different spheres of accountability, and assigns to public agencies the tasks of control and sanction of illicit practices (MPF, 2017). In terms of efficiency, the coordinated action between prosecutors and federal police officers in the use of mechanisms to investigate and control suspicious activities indicates a maturation in these two members of the microsystem (Arantes, 2011).

The number of political corruption cases prosecuted at the federal level was a result of this accumulation of organizational maturity. According to the creator of the specialized courts for crimes against the national financial system and money laundering "With these courts came the Banestado case, then the Mensalão and now the Lava Jato. The greatest recent achievement of the Brazilian judiciary was the creation of the money laundering courts, which inspired several countries".2 The incentives to concentrate material and human efforts in a single administrative unit within the justice system go beyond structural aspects, and specialized personnel become an isolated advantage. The Lava Jato Task Force, created at the Public Ministry, Brazil's accusatory organ, was composed of some of the characters that made up the CC5 Task Force, responsible for the Banestado Case, one of the largest police operations on financial crimes in Brazil and a pioneer in cooperation with international control agencies. At the time, the Federal Justice of Paraná already had a specialized court, in which the former judge Sérgio Moro accumulated institutional learning3 . Because of the interaction between the various parties in this fit, formal rules and institutional increments not only constrained the actors, but gave them the possibility to significantly alter and reshape each organization and its setting incrementally (Praça & Taylor, 2014).

From a geopolitical point of view, like other initiatives in the context of the new global order, financial crime regulations were led by the United States (Slaughter, 2004; Franco & Wood, 2010; Tourinho, 2018). A multilateral act to sanction bribery of foreign officials was signed under the auspices of the Organization for Economic Cooperation and Development (OECD) in 1997 (Saglibene, 2014). From then on, international organizations such as the IMF and the World Bank established a normative vision of good governance, and played a key role in the dissemination of New Public Management ideas (Brinkerhoff; Brinkerhoff 2015).

2 Gilson Dipp, president of the Federal Council of Justice in an interview to CNN available at https://www.cnnbrasil.com.br/politica/2021/04/25/lula-sera-julgado-em-foro-no-qual-jafoi-duas-vezes-absolvido

3 The specialization began with Res. 20, of May 26, 2003, of the TRF of the 4th Region, and Res. 99, of July 11, 2013, of the TRF changed the name of the 2nd Federal Criminal Court of Curitiba, renaming it the 13th Federal Court of Curitiba.

In parallel, professions and globalization have become intertwined, with lawyers, as economists, serving as epistemic brokers of ideas flowing through the transnational and domestic fields (Dezalay, 2004; Dezalay & Garth, 2002; Flood, 1996; Galanter, 1983; Kauppi & Madsen, 2014; Liu, 2008; Trubek et al., 1994). The transnational circulation of tangible and intangible resources and the consequences it produces within the legal complex is an endeavor of a multitude of actors (state bureaucrats, intellectuals, NGOs, etc.) combining uniformity with local differentiation (B. d. S. Santos, 1992; Trombini and Valarini, 2023). Because our study is empirical, addressing intentionality depends on accessing a particular arena and examining it at the actor-level. An example is the analysis by Ribeiro (2017) that shows how actors engaged in anti-corruption initiatives influence policy-making and were key in convincing parliamentarians to approve the Brazilian law on criminal organizations (Law 12.850/13). Acting as an interest group, prosecutors, judges and other members in the anti-corruption complex successfully formed a coalition with actors from the public safety policy subsystem, thereby diminishing the importance of the special investigative tools that would then be used in corruption and white-collar crime investigations.

To gain a visual understanding of how the anti-corruption policy arena was constructed, the chronology of events is helpful. This institutionalization happened around a shared vocabulary (legislation), tools (organizational systems), and spaces (forums and networks). We will call anti-corruption complex the empirical space in which actors from state bureaucracies and other legal professionals specialized in the defense of financial crimes interact.

#### **4 Where Do Legal Professionals Situate the Problem of Corruption?**

The analysis of the knowledge and cultural repertoire activated by the anticorruption group showed that the political sector and especially the political actors would be the core of the issue. Corruption would be located in the political field and would be attributable to personality traits of individuals who comprise it. Selfish and immoral people who lack moral and formal education would be occupying positions in the state administration, so corruption is understood as the "capture" of public interests for personal gains, such as enrichment, power, continuity and advancement in the political career. A second group of interviewees conceives corruption as something instrumental that serves to achieve both political and corporate objectives. The problem would be located within the electoral system, in which interchangeable actors participate, but with the main objective of supplying the high expenses necessary for the functioning of the political-party system. A smaller part of the interviewees localize corruption at the macro level. Corruption would be anchored in the capitalist model, which place the political "class" at the mercy of economic interests.

Next, we will present the results of the empirical analysis according to the frequency in which the collective mindsets were found among experts in the anti-corruption complex.

#### **5 The Moral Problem of Political Actors**

In this collective mindset the problem of corruption is located at the individual level. The actors that make up the political system have individual characteristics that explain their deviant behavior. Thus, corruption consists of a moral and educational problem of personal character, which afflicts the Brazilian political class. To stay in power and in politics politicians need money; therefore, they distance themselves from the purposes and expectations that fall on the holder of public office. Citizens of integrity shy away from this *locus*, characterized by a lack of integrity, and do not want their image linked to an immoral environment. Politics has undergone a deterioration process in the last decades, accentuated by recent governments. This deterioration is implicitly related to the rise to power of a group of "non-elite", people who do not meet the expected criteria of having educational and symbolic capital. With the rise of such political actors with no republican principles, the "public" arena has been distorted. However, politicians are not disconnected from society.  The actors in the justice system, along with some specific social groups, form the small group of people capable of discerning between a "good" and a "bad" candidate.

"I think that this if I do the cashiering is indispensable, the politicians at least see it that way, indispensable to be able to pursue the career, which would be that City Councilor, Representative, Mayor, Governor. And at the same time, the career is important. Unfortunately, I think that in most cases it's not for the public good etc., but for personal growth, both for enrichment and status. I think that these are two things that, until today, I'll tell you, in the last few years this has been changing, two, three years I don't know, but until yesterday it was a very big status to be a deputy, to be a senator, now I've noticed that it's not. I see some politicians, friends of mine, who are leaving and unfortunately usually those who have the most, rightly, integrity and are ashamed to present themselves as. This was not seen here in Brazil" (Federal Judge in Paraná).

"It is possible to separate two main groups: one of them that in my point of view is the worst, which is the corrupt politician, that politician that for many times already enters public office with the intention of doing wrong, wants to get rich, wants to take advantage of public office so for me this group is the most nefarious and many, in my understanding, Although I am not an expert, they border on psychopathy, they are psychopaths who do not face the situation of misery that we live in, they do not face how half of the Brazilians do not have basic sanitation, do not have water treatment, this is absurd, a rich country like ours, we are not a poor country, we are rich. And they close their eyes, they don't see that, they don't become a mayor, a governor, a president, a congressman, a senator, to do the best for the people... no, they are there to perpetuate themselves in power and to embezzle public values, employ their friends and family members and continue in power, continue stealing and continue that pattern. These are also considered white-collar criminals, right? (Federal prosecutor in São Paulo)"

The normative structure of this mindset reinforces the role of the politician vis-àvis society and the abdication of personal and individual aspirations for the sake of a greater good, the public good. The theory of change is based on individual characteristics, like parts that make up a whole. To render politics "clean", upright and moral, it would be enough to elect new virtuous representatives, eliminating corruption from the Brazilian context. This horizon is not seen by the holders of this *mindset* as a utopia, but a transformation possible through changing the people in power.

#### **6 Corruption: A System that Feeds and Regulates Itself**

The second CM that appears most frequently among the interviewees also locates the problem of corruption in the political sector. Differently from the dominant mindset, this one qualifies the phenomenon as instrumental to both economic and political organizations. Corruption is understood as a system that feeds and regulates itself, obeying its own rules. The competitiveness between parties and candidates for the supply of financial support coming from the market (big companies that need state intervention) and the need to raise votes in increasingly expensive campaigns would be the elements of self-management of this system. The economic system would play a part in this logic, although its relevance has a smaller scale compared to the centrality awarded to the political system in the relationship between both. Such an explanation is not lodged at the micro level, since the dynamics do not depend on specific actors, be they from economic or political organizations, to exist. Although individual interests are not excluded, the focus is on the configuration of the system itself, conceived to accommodate the relationship established between the two poles: state and corporate, public and private.

"I think it's basically a business view, it's the business model in Brazil. The Brazilian State is very big, it is very difficult to have a business with really great potential that you don't have as a client the State, and the State is basically corrupt. So there is no way to do business ethically, you wouldn't compete, you wouldn't win bids, you would have countless problems. Sometimes it seems that I'm saying that businessmen are the victims of a harassment by the political class. It is not true. It is a system that feeds itself, I mean, they are not the same as always, the politicians change, but the system is this of relationship, so for them it is a business model and for the politicians it is a model of political financing and also of personal enrichment and this is the system, its actors only change, it is a business model" (Federal prosecutor stationed in Paraná).

"These companies cost money and there is a certain lack of control over this, the campaigns in Brazil are increasingly expensive and the candidate to become competitive often has to have large sums of resources and in this context some fall into this temptation to accept values of criminal origin, right, eh there are so many cases of corruption involving illicit enrichment, as cases in which values of bribery settlements were intended for electoral campaigns right, there are no justifications for this being presented by the convicted for this behavior, because normally, as I said they deny it, but yes I think there is, if there was a decrease in the costs of these campaigns that would also lead to a decrease in the need for resources, it may be that there would be an incentive less, but see there are some cases in which these values were used for illicit enrichment, were not intended for elections" (Federal magistrate stationed in Paraná).

The analogy of corruption as a business system reinforces the interactionist framework of this explanation. Fighting a phenomenon characterized by reciprocity similar to that of market relations is a complex task, which involves reducing the incentives and trying to increase the costs of deviant conducts for each of the sides involved.

#### **7 Political System "Hostage" to the Economic System**

The last mindset reconstructs the idea of an economic bourgeoisie which holds power over several social spheres, among them, the Legislative and the Executive. Although politicians exert influence in certain domains, a form of power, they are not, in their great majority, the holders of economic capital, the necessary substratum for the realization of political elections. Mere pieces in a larger gear where class logic is determinant, elected representatives would be servants of the interests of the businessmen who elected them.

"When you see in practice what the parties do, what the politicians do, this group of parties and politicians...there are even politicians that are not members of Congress. Roberto Jefferson is no longer a deputy, but he still has power. So, this whole group, what do they do? They are not bourgeois? not necessarily. There are one or two bourgeois. You get the list of the 500 richest people in Brazil, the politicians are not in it, you know? You have one or another" (Rio de Janeiro lawyer).

One of the rules of interpretation of this mindset is that economic power, because it is what matters most in a society like the Brazilian, or any other capitalist one, dictates the rules of the game and controls which players remain or not in the game. Being a politician offers concrete advantages compared to how much power the majority of the population has access to, but the appearance of power confuses the true reality of a country divided into social strata with an economic elite at the top.

Table: Overview presentation of the results

(continued)

(continued)

(continued)

(continued)

#### **8 Discussion**

In this chapter, we consider which stocks of knowledge guide the action orientation of legal professionals about corruption, taking the relation between the political and economic sectors as our focus. The most recurrent pattern of interpretation among the group "Corruption: moral problem of the political actors" uses psychopathological explanations to interpret and justify deviant behavior, attributing to the individuals belonging to one of the poles of the corrupt relationship the character inclination to commit crimes. Locating the problem of corruption, or of any other deviance, at the micro level is not surprising considering that we are dealing with individuals trained in law and accustomed to calculate guilt based on individual conduct. Imbued with classical theories, in which rule-deviation is considered something "abnormal", as in criminogenic approaches, such a way of understanding reality is compatible with daily-life experiences and cognitive frames available in the spaces of the justice system.

However, the valence found in relation to politicians is a surprising element of the mindsets. The studied group are experts on the theme, but their way of understanding and locating corruption does not seem to differ from the way corruption is commonly understood by other societal groups. In other words, this does not seem to be a group-specific mindset associated with a certain expertise, given that blaming politicians for corruption is a common sense understanding of this action problem. Scholars of political culture in Brazil have argued that the concept of patrimonialism, the number of corruption scandals, and the way they are portrayed by the media, breeds the idea that the state is the natural space for vices (Filgueiras, 2009). Public officials working in white-collar crime in Brazil are more distrustful of the government than of the private sector, as supported by our findings. Even though the dominant mindsets do not rule out the responsibility and deviant action of the executives, they do so in a lateral way. Only in the recessive mindset (Political system "hostage" of the economic system) the

greatest amount of power, and of blame, is attributed to members of the economic class. Numerically, this pattern of interpretation is not expressive within the group.

The mindset that appeared as the second most frequent defines corruption as a reciprocal system "that feeds and regulates itself". This pattern of interpretation brings a more elaborate understanding of the phenomenon, which distances itself from personified explanations. Because it depends on the interaction of actors from different spheres, financial criminality, also regarded as a way of making business, requires a greater effort to be investigated and fought against. Considering that the holders of this collective mindset are mainly the members of the bureaucracy specialized in financial crime, we may associate this explanation with a professional vanity for the merits achieved in anticorruption investigations. Recognizing the "ecological" dimension of the phenomenon and contributing conceptually to the fight against corruption by emphasizing the procedural instruments that make criminal prosecution more efficient reinforces the Lava Jato group's attempt to differentiate itself from the rest of the state administration (see Trombini, 2023 for a detailed analysis). While the systemic mindset ("Corruption as a system that feeds and regulates itself") evokes self-conceit, it points out that there is no solution for the treatment of corruption, because it is a phenomenon that exists regardless of the actors and their agency. The existing points of contact between different sectors are not simply undone when certain actors (political and economic) leave the scene, like the moral mindset posits.

We know that the professions wish to aggrandize themselves, constituting a "jurisdiction" through professional knowledge systems (Abbott, 2005) or socially organized perceptual frameworks (Goodwin, 1996). Here, the stocks of knowledge about corruption and its main participants are contrasted with those of other holders of public office. Members to the anticorruption complex are neither unskilled lawyers too close to local power to hold them accountable for misconduct nor immoral politicians with a penchant for disregarding public interests. Experts ascribe knowledge and moral to themselves, and negatively evaluate politicians on the basis of the absence of these features. They claim to be more tuned with the republican principle of a clear separation between the public and the private, something that the two most dominant mindsets consider to be lacking in how corporate-state relations unfold at the Brazilian context.

The results of the CMA show that experts are preoccupied with providing answers to the question of how to best perform in the public interest. Efficiency and ethics are the key concepts guiding the cultural repertoire of legal professionals when inquired about corruption. Searching for normative and regulative institutions at the judicial field where the expert group studied is inserted helps explain the findings. The context in which these professionals are embedded is permeated by a certain vision of good governance and infused with ideas from new public management. To face the challenge of drawing a separation between the public and the private, the old-developmentalist and statist ideas (linked to corruption) should be replaced by a conservative liberal credo (linked to a competitive market). Rather than finding a way between the two extremes, as Bresser-Pereira (2001) recommended, they seem to insist on following the same steps given by Western European countries and the United States.

In common, lawyers, prosecutors, and judges suggest that the problem of corruption can be addressed by changing the "quality" of the political professional with the entry of people of "good character", bearers of morality. By doing so, they draw a distinction (Bourdieu, 1984): on the one hand there is a qualified civil service, recruited on the basis of merit, on the other, "unskilled" elected authorities that are not exposed to competition—either because the electorate cannot vote, or because party dynamics make competition dysfunctional, and corruption self-feeding. It is interesting to point out that these interpretative patterns, anchored in the belief of the advantages of meritocracy, are not shared by other elite groups in Brazil, especially professionals from which technocratic thinking would be expected, such as top executives at STEM (science, technology, engineering and math) careers.

The knowledge stocks of the Brazilian economic elite are more guided by instrumental concerns. State regulation of economic activities is understood as a necessary element for the survival of companies operating in Brazil, and problems of misconduct are seen as something that must be solved within the organizational environment (Valarini, 2018). Unlike the experts in the anti-corruption complex, the interpretation patterns of senior executives are more anchored in elements that symbolize paternalistic relationships, present in the political-economic environment, brought in parts by the neodevelopmentalist model, than elements acquired by the profession. As such, their understanding of efficiency and ethics is closely connected to doing business in a Latin American country.

The timeline of events depicted above showed that changes in legislation and institutional design created an anticorruption legal complex. A double movement of judicialization of conflicts and politicization of judicial institutions (Arantes, 2007) has awarded a central role to the actors employed in these bureaucracies. Their understanding of corruption portrays politicians as selfish, and executives as rational, the State as the place of vices, and the market of merit. If the professional independence of judges and prosecutors allows them to represent citizens' interests, the technocratic basis of their decisions (Pádua, 2008) and the low social control they experience (Bresser Pereira, 2007) are negative factors. The

same elements that grant control bodies necessary autonomy to investigate and judge high executives and politicians offer them a chance to reshape the electoral, social, and economic landscape without having to be elected.

Their advice for how to best perform in the public interest involves professionalism, impersonal selection through entrance competitions, and increased autonomy from political influence. The most dominant mindset vocalizes a resentment against the political elites. A potential explanation is that the interviewees do not come from the same families that traditionally occupied the judiciary before public competitions and the creation of the Public Ministry, in a historical period when political, business and judicial elites all belonged to a single uniform group. According to Grün (2011), the newly arrived individuals in the elites are usually the main operators of scandals, the "champions of justice" and traditional moral principles that would be ignored by the dominant elites. Yet our work (Trombini et al., 2022) with prosopographical data from the anticorruption group has showed that the majority comes from an elite background. Still, the moral mindset agrees that politicians are who to blame.

This brings us to an ambiguous aspect of the mindsets. Not all politicians are considered to be immoral, and the emergence of a systemic pattern of corruption is regarded as a phenomenon from recent history. Legal professionals suggest that greater pluralism (an intrinsic requirement for democratic consolidation) has been responsible for increasing the distances between the "virtuous" senior civil servant and this other less respectable public officials at a "contaminated" political space. There were the politics of before and the politics of now, with skilled people staying in the market instead of running for office. This stance, of elitist arrogance, is opposed to populist resentment, but the two often go together. Writing about such unexpected companions, Galston (2014) cautioned that "public-spirited individuals who genuinely want to promote the public interest can end up longing for a form of leadership that is not regularly accountable to the people".

Blaming out-groups for corruption did not come as a surprise, neither did blaming the political group that was in power in the last decades, while scandals like the Mensalão and Lava Jato took place. Recent episodes that placed members of the high echelons of the political and economic system in prison show that members of the anticorruption complex behave like *elite challengers* (Johansson & Uhlin, 2020). Noteworthy is that rather than allying themselves to other ruling elites, like in the past (Love & Barickman, 1986; Adorno, 1988; Werneck Vianna, 1999; Carvalho, 2003; Almeida, 2010), the elite from the anticorruption complex is more selective when deciding who to challenge. They still exhibit liberal ideologies and conservatism, which might explain why they attribute blame to a certain political group. Together with resentment over the loss of privileges, conservatism is another motivation for antipetism, being against the PT, or Worker's Party (Aquino, 2019). Other investigations into the political uses of law by experts, in public administration particularly, still need to shed light on the interplay between individual and professional characteristics that may affect variance in mindsets. Focusing on class, ideology and career might be a promising route for addressing convergence and divergence in cultural repertoires.

#### **9 Conclusions**

We started from a question about the meeting point between Law and Politics to look at the empirical space of the professionals working in the anti-corruption complex. Our results show that the bearers of the reconstructed patterns locate the problem of corruption among politicians, by looking at the micro (immoral individuals) or meso (political system) levels. Their mindsets criticize patrimonialism and a lack of separation between the public and private domains and recommend efficiency and ethics, two features of the anticorruption complex, to remedy that. Not all politicians are blamed and labeled corrupt, and resentment and arrogance help explaining who is regarded as guilty and unskilled. The fact that the subpopulation of lawyers, prosecutors and judges working on corruption scandals does not recognize itself as agents highlights the importance of using qualitative methods to get a grip at the self-presentations of the group. In representative democracies with electoral systems, the autonomy of legal professionals employed at state careers that enable them to do policy-making must be checked, as other contributions in this volume argue.

One can safely admit that not only in Brazil the dynamics of corruption scandals transformed the legal complex. With "*affaires*" *of* corruption, French, Spanish and Italian judges became protagonists in the public arena. Sometimes against their will, these members of the Judiciary engaged in anti-corruption become "symbols of a tumultuous revolution in the more or less Jacobin conceptions of the Republic and the evolution of a democracy of opinion orchestrated by the media" (Pujas, 2000). Studying the rise of Western liberalism from the 18th to the twentieth century, Karpik and Halliday (2011) had predicted a contest between a "political" strand that emphasizes local democratic practice, and an "economic" strand that emphasizes market transactions, noting that the latter leads. We can, for now, say that the anti-corruption complex in Brazil is also an example of this trend of rising liberal economic thinking. Mapping which cultural repertoires are activated by the group when explaining other action problems, like what logics are at work inside economic organizations, and comparing these results with the findings here is a first step to advance this research agenda. The content of the group's thinking remains to be investigated in more detail and the undemocratic consequences of their behaviors further problematized to avoid harm in the future.

#### **Appendix I**

(continued)

(continued)

#### **References**

**Open Access** This chapter is licensed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

The images or other third party material in this chapter are included in the chapter's Creative Commons license, unless indicated otherwise in a credit line to the material. If material is not included in the chapter's Creative Commons license and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder.

## **Moro's Opinions: A Quantitative Analysis of Sentencing in Operation Car Wash**

Luciano Da Ros, Luísa Zanini da Fontoura, Sérgio Simoni Junior and Matthew M. Taylor

#### **1 Introduction**

The literature on legal accountability is playing catch-up to the literature on decision-making in judicial review cases. Relatively little is known about the factors that influence judges as they consider imposing civil and criminal penalties, and even less in countries outside North America and Europe. The gap is especially pronounced with corruption: despite growing numbers of cases around the globe, the literature on judicial decision-making in corruption prosecutions remains sparse. Why do judges convict some defendants in corruption cases and not others? Why do judges apply harsher sentences to some defendants than others? In sum, what explains variation in the severity with which the judicial system judges public figures and private citizens accused of corruption?

These questions are clearly relevant both for public debate and academic theory, but have only recently been raised in the specialized literature. One cause

L. Z. da Fontoura · S. S. Junior Federal University of Rio Grande Do Sul, Porto Alegre, Brazil e-mail<EMAIL_ADDRESS>
S. S. Junior e-mail<EMAIL_ADDRESS>
M. M. Taylor American University, Washington, USA e-mail<EMAIL_ADDRESS>
© The Author(s) 2024 M. E. Trombini et al. (eds.), *The Fight against Systemic Corruption*, Organization, Management and Crime – Organisation, Management und Kriminalität, https://doi.org/10.1007/978-3-658-43579-0\_5

111

L. Da Ros (B)

Federal University of Santa Catarina, Florianópolis, Brazil e-mail<EMAIL_ADDRESS>
of this neglect may be data availability: there have not always been sufficient numbers of cases to evaluate judicial behavior regarding legal accountability. Associated with this is a problem of comparison: seldom are cases comparable to one another along a range of dimensions, holding constant legal system, jurisdiction, statutes, case details, or contextual background. One consequence is that most academic research of legal accountability in corruption cases tends toward qualitative analyses of aggregate patterns, using longitudinal case studies or small-N comparative research.

Brazil's Operation Car Wash (*Lava Jato*, in Portuguese), perhaps the "the largest corruption scandal ever to beset at democratic nation" (Fisman & Golden, 2017, 13), offers a unique opportunity to address these questions, partly because of the large number of cases that were heard in a single courtroom, by a single judge.

Operation Car Wash was a criminal investigation into grand corruption and money laundering that began in March 2014 in the Brazilian city of Curitiba. It began as an inquiry into irregularities at the state-controlled oil firm Petrobras, Brazil's largest company. Investigations progressed rapidly, unveiling evidence of corruption totaling billions of dollars, covering a wide variety of government agencies, and implicating politicians, bureaucrats, businesspeople and financial operators. Over the course of nearly seven years, the operation indicted, convicted and imprisoned hundreds of individuals (Rodrigues, 2020; Lagunes & Svejnar, 2020; Da Ros & Taylor, 2022). As Operation Car Wash both fueled and was fueled by severe political and economic crises that brewed simultaneously in Brazil over the 2010s, many studies cast an unflattering light on the investigation's consequences for Brazilian democracy (Sá e Silva, 2020; Kerche & Marona, 2022; Santos & Gallego, 2022).

At the heart of the operation was the 13th Federal Trial Court of Curitiba, specialized in money laundering crimes. It was presided over by Judge Sérgio Moro between March 2014 and November 2018, when Moro resigned from the judiciary to become Minister of Justice. From Curitiba, the operation spread to several courts around the country and even beyond Brazil. But it was in Curitiba that the most consequential decisions were rendered, including the convictions of leading politicians such as the former president of the Chamber of Deputies Eduardo Cunha, former presidential chief of staff José Dirceu, former Finance Minister Antônio Palocci and former President Luiz Inácio Lula da Silva. Prominent business people, long accustomed to impunity, were also convicted, including the scion of the Odebrecht construction empire, and many of his ostensible competitors.

The prominence of the defendants, the political repercussions of the case, Judge Moro's own career choices after he left the judiciary, and the intense public awareness of Operation Car Wash have meant that the trial court's decisions are frequently interpreted through a subjective lens, defined by observers' political leanings or their perspectives on how corruption should be addressed. Operation Car Wash, Moro, and Moro's decisions have increasingly become an object of criticism over the last few years. Many of Moro's decisions would later be overturned by the Brazilian Supreme Court—notably the conviction of former president Luiz Inácio Lula da Silva—due to different allegations of abuse and bias while Moro presided over the investigation (Da Ros & Taylor, 2022; Prado & Machado, 2022a, b).

Despite these important caveats, we believe that analyzing Moro's decisions on their own—without reference to his later career decisions or the subsequent decisions of higher courts—is an important exercise for understanding the factors that determine judicial decision-making in corruption trials. Seldom has a trial court judge in any jurisdiction presided over such a large number of interconnected corruption cases. The extensive dataset of cases compiled from Moro's decisions, moreover, enables this paper to take an arms' length perspective, analyzing Moro's sentences through multivariate quantitative analysis of the effect of two sets of variables on judicial decisions regarding conviction and sentence length: variables related to defendant profiles and to prosecutorial strategies. In so doing, we hope to contribute both to the broader global literature on the judicial role in anticorruption, as well as to the debate within Brazil concerning Judge Moro's decisions and the workings of Operation Car Wash, building upon the predominantly qualitative literature on these topics.

To that end, the next section offers a conceptual framework and lays out the hypotheses that guide the analysis. The third section details the data and method. The fourth presents the results. The paper concludes with a summary of the findings and suggestions for future research.

#### **2 Legal Accountability: Definitions and Hypotheses**

Questions regarding variation in the incidence and intensity of judicial responses to corruption are closely related to the debate on accountability. Accountability refers to the obligation of public officials to explain their actions and to answer for them. Accountability has been classified in a variety of types, which seldom explicitly reference the judiciary (Schedler, 1999; Manin et al., 1999; Taylor, 2019). For the purposes of this paper, we refer to the specific judicial role in accountability as legal accountability, defined as the enforcement of civil or criminal sanctions by judicial agents (Bovens, 2007; Lindberg, 2013; Da Ros, 2019).1

The academic literature on judicial behavior has focused predominantly on supreme courts and constitutional review, seeking to understand which factors political, social, institutional etc.—influence the decisions made by judges and justices in the exercise of their duties (Da Ros & Taylor, 2019; Hilbink & Ingram, 2019). The vast comparative literature on judicial behavior has used judicial review cases to theorize a variety of explanatory models, such as the attitudinal, strategic and institutionalist.2

Theorization of how judges decide corruption cases, however, remains incipient. There has been almost no adaptation of theories from other areas of judicial behavior to corruption cases, nor has there been much theorizing derived from corruption cases themselves. In part, this is because of a methodological bias that hinders both the formulation of new theories and the testing of existing theory: most approaches to legal accountability in corruption rely on aggregate data (e.g., the total number of criminal convictions per country or period). The unit of analysis is often the entire collectivity: cases in a given country or state, for example. As a consequence, conclusions are drawn by aggregation: patterns of corruption and accountability in a given jurisdiction. This approach does not allow for analyses in which each judicial decision constitutes the unit of analysis (King, 1997).

The most typical aggregate approach is the longitudinal case study, seeking to explain why the judiciary in a particular country has come to convict a larger or smaller number of defendants for corruption over time. Generally motivated by the occurrence of major investigations that profoundly impacted the political system, the effort of these studies is to understand why prosecutors and judges began to behave more assertively. Examples of this approach include a variety of exemplary case studies, such as analyses of the Mani Pulite investigations in Italy in the 1990s and its consequences over the following decades (della Porta, 2001; della Porta & Vannucci, 2007; Vannucci, 2009; Dallara, 2019; Manzi, 2021), the

1 It is worth stressing that the literature has found no positive association between rates of corruption convictions and the incidence of corruption. Indeed, "a higher level of convictions per capita is often less an indicator of high corruption than of a more determined fight against it" (Karklins, 2005, 134). The number of criminal convictions in corruption cases thus cannot be considered a reliable indicator of corruption levels proper. Instead, it captures the performance of judicial institutions, including the workings of investigative, prosecutorial, and trial bodies.

2 Epstein and Lindquist (2017) review existing theories.

corruption trials in France during the 1990s (Roussel, 1998; Garraud, 2001; Adut, 2004), recent prominent cases in Latin America (Conagham, 2012; Michener & Pereira, 2016) and, of course, studies of Operation Car Wash itself (Lagunes & Svejnar, 2020; Rodrigues, 2020; Sá e Silva, 2020; Kerche & Marona, 2022; Da Ros & Taylor, 2022).

A second approach also relies on aggregate data, but does so comparatively. Such studies seek to understand why some polities have produced more legal accountability (i.e., investigations, prosecutions, convictions) than others. Such studies typically draw from a relatively small number of cases, dedicating themselves to comparing different countries, states or governments in Western Europe (Sousa, 2002; Maravall, 2003; Sims, 2011; Guarnieri et al., 2020), Latin America (Da Ros, 2014; Ang, 2017; González-Ocantos & Hidalgo, 2019; Pimenta & Greene, 2020) and Eastern Europe (Popova & Post, 2018).

One of the consequences of the predominance of aggregate approaches is that the use of qualitative methods prevails. Multivariate quantitative studies based on individual data have been less common, despite recent efforts in this direction (Ang, 2017; Gehrke, 2019; Bento et al., 2020; Mancuso et al., 2021). This is because aggregate approaches often reduce the number of units of analysis by treating the available data in aggregate form. That is, because they are concerned with explaining the overall pattern of charges or convictions, these studies often do not inquire into which factors influence individual decisions by prosecutors and judges to charge or convict defendants, or which factors impact the penalties imposed on convicted defendants.

This paper disaggregates the data, using each of the individual judicial decisions against specific defendants as units of analysis. The use of individual decisions permits us to employ multivariate techniques that complement existing qualitative perspectives. Our hypotheses are derived from aggregate research on the subject and from studies on judicial behavior in judicial review cases (an area of research in which individual approaches predominate).3 The hypotheses fit into two pairs, regarding: 1) defendant characteristics; and 2) prosecutorial strategies.

The first pair seeks to understand judicial decisions to convict, and the penalties imposed, based on defendant characteristics, such as profession and, in the case of politicians, their party affiliation. With regard to profession, our hypothesis is that judges may act differently depending on whether they are judging politicians, businessmen, bureaucrats, money launderers or unwitting accessories

3 This includes the studies most commonly associated to the attitudinal and strategic approaches to judicial behavior (Segal & Spaeth, 2002, Epstein & Knight, 1998).

(*laranjas*). Politicians are expected to be less likely to be convicted, in line with the strategic approach to judicial behavior, because courts are likely to be reticent to move against those who can wield power against them (Maltzman et al., 1999). Indeed, most judicial anticorruption efforts seemed targeted at petty corruption in Brazil until recently (Madeira & Geliski, 2019; Levcovitz, 2020). We assume that more powerful defendants, or those with greater capacity to damage the judiciary or individual judges, are likely to be treated more leniently than less powerful defendants (H1a). The second hypothesis is that judges may decide cases differently depending on defendants' political affiliation (H1b). We test whether there is differential treatment of politicians by party. This hypothesis conceives of judicial behavior as an extension of party competition (Gordon, 2009; Ríos-Figueroa, 2012; Ang, 2017; Popova & Post, 2018), and is closely aligned with the attitudinal model, in which judges' political attitudes are considered major motivators of judicial behavior (Segal & Spaeth, 2002).4 This produces two hypotheses:

The second pair of hypotheses refers to prosecutorial strategies. Even though the cases all involved corruption, defendants faced diverse charges. Brazilian law dictates different sentences for different crimes, ranging between 2 and 12 years for active and passive corruption (roughly, bribe-paying and bribe-receipt), between 3 and 10 years for money laundering, and between 3 and 8 years for criminal organization, for instance. Defendants may also face more severe charges, for example, for higher volumes of money laundering. The first hypothesis of this second pair (H2a) is that some types of crime are likely to lead to more severe treatment, and the higher the number of crimes for which defendants have been charged, the more likely this is to lead to conviction and heavier sentences. The second hypothesis (H2b) is that the type and quantity of evidence will increase the severity of sentencing. Evidence may come from a variety of sources, including prosecutorial witnesses, phone intercepts and electronic data (including text messages, messaging apps, email, and cloud data), audit reports, and information provided by the financial intelligence unit COAF and the Federal Revenue Service, among others. This information allows us to evaluate how the information prosecutors provide influences judges' behavior (Machado & Paschoal, 2016;

4 More broadly, corruption accusations are often deployed as weapons in political competition (Balán, 2011).

Arantes & Moreira, 2019). We also take into account plea bargain agreements, which likely affect plea bargainers' chances of conviction and the severity of sentencing and other defendants tried within the same case. The two hypotheses are expressed as follows:

#### **3 Data and Descriptive Analysis**

The dataset used to analyze these hypotheses was compiled from the website maintained by the Federal Judiciary of Paraná (JFPR), which encompasses the 13th Federal Court of Curitiba and permits full consultation of all criminal cases tried by Judge Sérgio Moro between March 2014 and November 2018. Similar data has been used previously by other scholars, such as Fontoura (2019) and Rodrigues (2020); we compiled the dataset used here directly from the JFPR website, checking it against the data compiled by those two authors.5 We have downloaded the sentences and decisions on interlocutory appeals (*embargos de declaração*, which are appeals within the same court, akin to requests for amendment of judgement). Having analyzed the text of the decisions, we compiled the database for the variables of interest.

This study does not cover the totality of Sérgio Moro' s behavior within Operation Car Wash. We only analyze his sentences quantitatively. This means that the paper ignores both the judge's off-the-bench behavior, such as interviews, press releases and opinions on legislative proposals (Hilbink & Ingram, 2019). We also leave aside Moro's control over the court's agenda, the timing with which cases were dispatched, and several consequential decisions taken outside the strict limits of the cases, such as the decision to publicize recorded audios of conversations between former President Lula and then President Dilma Rousseff. Similarly, our research does not cover all sentences offered under the umbrella of Operation Car Wash. Other judges also handed down decisions, including Moro's successors at

5 We are grateful to Fabiana Rodrigues for sharing data on the number of prosecution witnesses.

the 13th Federal Court of Curitiba after 2018, as well as judges participating in related cases in Rio de Janeiro, São Paulo and Brasília, including higher courts.

That said, Moro's role was significant, setting both the tone and the tenor for Car Wash, and representing the bulk of the decisions made in the investigation from 2014 to 2018. During almost the entire period he ran the 13th Federal Court of Curitiba, Moro's court had unique jurisdiction over cases in Operation Car Wash, judging a total of 46 criminal cases filed against 193 different defendants on the merits. Because some defendants appeared in more than one case, Moro actually made 289 decisions. These decisions constitute our units of analysis. We exclude those cases in which the sentence was suspended by the judge because the defendant signed a plea bargain agreement and had already served the sentence established in the agreement (e.g., Alberto Youssef in case n. 5028608- 95.2<IP_ADDRESS>00), as well as those cases in which the defendant died before trial (e.g., Humberto Mesquita in case n. 5025676-71.2<IP_ADDRESS>00). Finally, we excluded cases of defendants whose indictments were not accepted by the court (*denúncia não recebida*) so that they could be tried in other related cases.6

Because we are interested in what factors lead to conviction and the length of the penalties imposed, the dependent variable was measured in two ways. The first was through a dummy variable for conviction. A zero score might occur either because of acquittal or because the defendant "ceased to be convicted" on account of a lis pendens situation (of parallel proceedings; e.g., Waldomiro de Oliveira in case n. 5083258-29.2<IP_ADDRESS>00).7 The second measure of the dependent variable is a continuous measure of the length of sentence for convicted defendants, ranging from 18 to 250 months.

For defendants who signed plea bargain agreements, we use the sentence length stipulated in judgment before the application of the agreements' benefits. We take this approach because most agreements unified the penalties of the defendants not only in cases that had already been tried, but also in cases that were still ongoing. Thus, because the database is comprised only of cases that were actually judged, it would be reckless to stipulate exactly what would be the

6 In twelve cases the indictments were not accepted. Of these, three were not accepted by the court because the evidence was weak. In the remaining nine cases, the indictment was not accepted because the defendant was facing other charges in other cases, because the case was broken into smaller cases, or because the defendant was a fugitive from justice, awaiting extradition abroad. In four additional cases that were also excluded from our dataset, the indictment was accepted, but the cases were set aside because the defendants were facing extradition.

7 There are only eight cases of a defendant who "ceased to be convicted," rather than either being convicted or absolved.

size of the reduction obtained, since many cases are still pending trial. Although this may produce a certain artificiality, especially as regards the impact of the plea-bargaining variable on the length of the defendants' sentences, it is the most conservative approach for the quantitative treatment of these cases.8

The first set of independent variables relate to defendant characteristics: their profession, and in the case of politicians, their respective parties at the time. Professions were divided into six groups: politicians, civil servants, business owners, business executives, financial operators and others. The first encompasses both elected officials who did not hold office at the time of the sentence,9 as well as high-level party functionaries (e.g., treasurers); the second includes all public sector officials, including executives at state-owned companies like Petrobras; the third includes owners or shareholders of private sector companies; the fourth concerns salaried executives in the private sector; financial operators includes money launderers colloquially known as *doleiros* and other agents specialized in asset laundering; and finally, the last category is residual and includes unwitting accessories (*laranjas*), family members and advisors. The political parties of those classified as "politicians" in the previous variable were divided into four groups: PT, PP, PMDB, and others.

The second set of independent variables relates to prosecutorial decisions: the type and number of crimes charged; the amount of money laundered; the types of evidence utilized; the timing of indictments; and the existence of a plea bargain prior to sentencing. Crimes were divided into five types: active corruption (bribe-paying), passive corruption (bribe receipt), criminal organization, money laundering, and others. The latter is a residual category that captures crimes that were charged less frequently (e.g., tax evasion, obstruction of justice, use of false documents, international drug trafficking). The number of crimes for which the defendants were accused is a sum of these dummies (including the category "others"). This generated a continuous variable that ranged between 1 and 6. Types of evidence were categorized as follows: phone intercepts, electronic data, search and seizure, and forensics by the Federal Police (PF) and the Public

8 We also tested a different measure of the dependent variable, incorporating the agreements by dividing the penalty established in the agreement by the number of cases tried after the defendants signed the agreement. This did not significantly affect the results. However, it is not included here because it is somewhat misleading: in some cases, the new "average sentence post-agreement" was higher than the previous sentence. This is because, as noted above, many plea bargainers' cases were still pending, so the actual potential sentence was higher than that reflected in the cases in our dataset.

9 Under Brazilian law, sitting politicians cannot be tried in the trial court, but instead are tried under the original jurisdiction of higher courts.

Ministry (MPF), as well as evidence produced by other agencies, such as the Central Bank (BACEN), Federal Revenue Secretariat (SRF), the Financial Activities Control Council (COAF), the comptroller general's office (CGU) and the federal accountability agency (TCU), as well as information provided by Petrobras itself and evidence derived from international cooperation. The sum of these dummies accounted for the total number of types of evidence presented in court, ranging from 2 to 10. To account for the accumulation of evidence within the overall operation, the variable "order of indictments" orders the cases according to the date in which indictments were presented. "Number of prosecution witnesses" is a continuous measure ranging from 2 to 29, extracted from Rodrigues (2020). "Plea bargainer" indicates whether the defendant signed a plea bargain before sentencing. "Number of other plea bargainers" sums the number of other defendants within each case who had signed plea bargain agreements, seeking to account for the cumulative impact of plea bargainers on another defendant's chances of conviction and the severity of sentencing.

Table 1 details the dummy variables and Table 2 details the continuous variables. A few descriptive points are of note. The trial data suggest that Moro was a tough judge In Operation Car Wash, especially by comparison to judges in other corruption cases tried in Brazil. On average, 73.7% of Moro' s decisions were convictions, with average sentences of 113.5 months, or nearly nine and a half years in prison. This conviction rate is much higher than found in other studies of judicial treatment of corruption in Brazil: in the case of sitting politicians judged by the Supreme Court (STF), the rate is below 5% (Falcão et al., 2017; Gomes Neto & Carvalho, 2021); in the case of public servants expelled from the federal administration (predominantly for petty corruption), the conviction rate is around 20% (Alencar & Gico Jr., 2011); in the cases of high-ranking public officials tried within the federal court system, the conviction rate is around 10% (Levcovitz, 2020); and in the case of municipal mayors tried by a specialized panel within state courts, the rate reaches 18% (Bento et al., 2020). Evidence from the judicial decision-making in previous national corruption scandals also stresses the severity of Moro's rulings: in very few of the most prominent scandals of the 1990s analyzed by Taylor and Buranelli (2007) were the defendants ever convicted.

Regarding H1a, although Operation Car Wash is often referred to as an investigation into political corruption, "Politician" was the least frequent profession among the defendants judged by Moro, comprising just over 7% of the total, far behind financial operators, who made up 24% of the cases. The fact that there were few political defendants, of course, should not obscure the fact that they were all convicted in all the cases in which they were tried, reaching a

(continued)

#### **Table 1** (continued)

**Table 2** Descriptive statistics, continuous variables

\* Three cases had zero values and were coded as 1 in the multivariate models, so as not to lose these cases

\*\* The maximum value is not equal to the number of judicial cases (46) because a few indictments were presented in court on the same date

perfect 100% conviction rate. This did not occur with any other variable. One consequence of this perfect conviction record for politicians is that there were no differences in conviction rates between defendants from distinct political parties.

Regarding H1b, there was a clear preponderance of members of the PT among the politicians who were tried. While this has been interpreted as a sign of bias on the part of federal prosecutors, who filed charges against PT politicians more often than against politicians of other parties, it is also the case that the PT defendants heard in the trial court were former occupants of federal elective offices and therefore no longer enjoyed the original jurisdiction of the Supreme Court (STF). This was the case for former President Lula and former ministers Dirceu and Palocci, for example. Many politicians from other parties who were implicated in wrongdoing still held public office during the investigations and their cases were therefore not heard by the trial court, but instead by the STF, which moved slowly on cases of politicians implicated in Car Wash. For example, Eduardo Cunha, former president of the Chamber of Deputies and a member of the PMDB, was only tried by Moro after he was suspended by Congress and he was therefore no longer eligible for the original jurisdiction of the STF. Yet, because the number of political defendants is quite small, it is important to be cautious about drawing conclusions within this group of defendants.

Regarding H2a, although Car Wash is usually associated with corruption, the crime most frequently tried by Moro was actually money laundering, present in 85% of his court's decisions, followed by active or passive corruption (60%), criminal organization (35%) and other crimes (17%). Because defendants were often charged with more than one crime per indictment (the average is 2 crimes per indictment), money laundering made up 43% of the charges, followed by active and passive corruption (which together comprised 30% of the charges), criminal organization (18%) and others (9%). Scholars have been broadly aware that much of the expertise invested in fighting "corruption" in Brazil since the 1990s has in fact been derived from increasing capacity to enforce money laundering laws, including specialized police and judicial bodies (Da Ros & Taylor, 2022). Lastly, the residual category "Other crimes" has the highest conviction rate, 93.9%, which may be due to the specificity of several of these crimes, for which only one defendant has sometimes been accused in the entire database.

Finally, regarding H2b, evidence provided by the Federal Police and federal prosecutors is the most frequent type of evidence, and evidence from searches and seizures by these two bodies is cited in more than 90% of cases. There is also intense participation by the SRF revenue agency and the Central Bank in cases involving tax and bank data, respectively, accounting for more than 80% of the cases. There is comparatively little evidence provided by the COAF financial intelligence agency, the TCU accounting body and the CGU comptroller general's office. There is copious evidence provided by Petrobras, which aided the prosecution in several cases, as well as from international bodies, with these two sources providing evidence in more than half of all cases. As a result, various types of evidence have been deployed jointly, averaging more than six types of evidence per case. These descriptive results corroborate something that has frequently been reported in qualitative studies of Car Wash: extensive inter-institutional and international cooperation, unprecedented in previous investigations (Rodrigues, 2020; Da Ros & Taylor, 2022). Finally, plea bargainers constituted a significant group of both indicted and convicted defendants. Indeed, plea bargainers' trials make up almost a third of the decisions, and other plea bargaining defendants within each case average almost 3 per case, reaching a maximum of 10 in one case. This may be a consequence of the widespread and unprecedented use of plea bargains in Car Wash, made possible by the Law of Criminal Organizations enacted shortly before the beginning of the investigation (Rodrigues, 2020; Prado & Machado, 2022a). It may also result, however, from a relatively small set of plea bargaining defendants who were accused in several cases, such as the *doleiro* Alberto Youssef, who was tried in 16 different cases, and former Petrobras executive Paulo Roberto Costa, tried in 10 cases. Still, it is noteworthy that even in cases of plea bargaining defendants, the conviction rate does not reach 100%. That is, even though all plea bargainers were convicted at least once, not all cases against plea bargaining defendants resulted in conviction.10

#### **4 Multivariate Analysis**

Because the dependent variable is measured in two distinct yet interrelated ways, the multivariate analysis relies on a two-part model (2PM). The first measure of the dependent variable is a dummy variable of the decision to convict; the second is a continuous variable of the length of the sentences (in months) imposed on convicted defendants. The second decision is dependent on the first: only convicted defendants receive a sentence. Yet, factors affecting the likelihood of conviction need not be the same ones that impact sentence length. Therefore, our identification strategy requires a selection model that estimates two equations

10 For instance, while plea bargainer Paulo Roberto Costa had already been convicted in other cases, he was acquitted for lack of evidence in case n. 5012331-04.2<IP_ADDRESS>00, decided in September 2015.

sequentially, given the presence of censored data in the second measure of the dependent variable.

We adopted the 2PM due to its flexibility in comparison to other sample selection models and its fit with the characteristics of our data (Vance & Ritter, 2014). First, it allows all the independent variables used in the first stage equation to also be used in the second stage. That is, it does not require the specification of an "exclusion restriction" in the first stage that need to be omitted in the second stage. Second, the 2PM permits the results in the second stage to be interpreted as actual outcomes, not just as potential outcomes. That follows from the fact that the 2PM treats the censored observations at the second stage as zeros, not as missing cases, given that they comprise non-convictions.11

The first stage of the 2PM uses multiple logistic regression to analyze the decisions to convict. Coefficients are reported as odds-ratios. The second stage consists of an ordinary least squares regression calculating the marginal effects of the independent variables on sentence length. In each of the two stages, we ran three different models, resulting in six models in all: models 1A, 1B and 1C are the first stage of the 2PM, reporting the results of the multiple logistic regression; and models 2A, 2B and 2C are the second stage of the 2PM, reporting the marginal effects.

The option to adopt three different models in each stage of the 2PM stems from the challenge that the plea bargaining defendants pose to the models. Plea bargainers are essentially confessed defendants, so we use the sentences these defendants faced before the application of the benefits of their plea agreement, as explained previously. Thus, the first model of each stage (the "A" models) excludes *cases* of plea bargainers (reducing N to 196 in Model 1, and to 135 in Model 2); the second model (the "B" models) includes all cases (N = 289 in Model 1, and N = 213 in Model 2), but excludes only the *variable* "plea bargainer"; and the third model (the "C" models) is complete, including both plea bargainers' *cases* and the "plea bargainer" *variable*. In all models, we clustered decisions by repeat defendants and used heteroscedastic-robust standard errors.

In the case of the dummy variables for "Profession", "Political party" and "Crimes", the omitted categories are the variables "Other professions", "Other parties" and "Other crimes," respectively. As observed above, there is a perfect conviction rate for politicians. Consequently, the independent variable "politician" is a perfect predictor of the dependent variable "conviction," and thus is automatically excluded from the first stage of the 2PM. In this case, the sum of

11 These characteristics of the 2PM make it different, for instance, from the sample selection model proposed by Heckman ( 1979).

politicians with "other professions" is adopted as the omitted reference category. Also because of that, the variable "Political party" was excluded from the first stage of the 2PM, as all politicians (from all parties) were convicted. We used the natural logarithm of the amount of money laundered to normalize the distribution of the variable. The variable "Sum of types of evidence" was excluded from the multivariate models because it was highly collinear with the other evidence variables (since it is their sum). Additionally, our multicollinearity analysis found a high correlation of "plea bargainer" with profession: only one politician was a plea bargainer, and few in the category "other professions" were plea bargainers. Said another way: the vast majority of plea bargainers were financial operators, executives and business owners.

The results in Table 3 suggest that some variables strongly determine the chances of conviction. In addition to the perfect "politician" predictor identified in the descriptive analysis, this includes the profession of "financial operator," which increases the chances of conviction by between 3.4 and 12.6 times, relative to the omitted category. Each additional crime with which the defendant is charged increases the chances of conviction by about 14 times. Given that Moro's court specialized in money laundering, it is interesting that money laundering led to less likelihood of conviction, other things equal. Regarding the types of evidence, two variables are positively associated with increased likelihood of conviction: electronic data and CGU information. The first increases the chances of conviction between 6.9 and 11.2 times, and the second between 45.1 and 175.3 times. Although the magnitude of the coefficients is very high in the latter case, it is worth remembering it is drawing on a very small number of cases (14), so these conclusions should be read carefully. Surprisingly, the number of other defendants who were plea bargainers decreases the chances of conviction, suggesting that prosecutions may become weaker as more plea bargainers are added. Finally, as expected, plea bargainers increase the chances of their own conviction by 2.2 times, as inferred from the only model in which the variable appears, 1C.

The variables mentioned in the paragraph above were statistically significant at the 0.10 level in all models in which they were included. A few other variables were statistically significant in some of the models, but not all. The variable "Active corruption" was significant only in models 1B and 1C, with a negative impact on the defendants' likelihood of conviction. The variables COAF, TCU and foreign cooperation, in turn, were significant only in one of the models (1A in the first two cases, and 1B in the last case). Whereas COAF is negatively associated to the likelihood of conviction, TCU and foreign cooperation are positively associated to it.

**Table 3** Multiple logistic regression, first stage of 2PM

(continued)

#### **Table 3** (continued)

Exponentiated coefficients; 95% confidence intervals in brackets

\* *p* < 0.1, \*\* *p* < 0.05, \*\*\* *p* < 0.01

Table 4, reporting the marginal effects derived from the estimation results of both the first-stage logit and the second-stage OLS regression, suggests that some variables have a substantive effect on sentence length, conditional on the incidence of a conviction. Politicians were treated the most harshly, with sentences between 46 and 50 months longer than other professions. They were followed by financial operators, whose sentences were longer than defendants from other professions by 25 to 33 months. The number of crimes charged leads to increased sentences, with each charge increasing the expected sentence by 47 to 50 months. Regarding the types of evidence, electronic data increased expected sentence length by 41 to 45 months. Contrary to initial expectations, evidence from the Revenue Service in cases of lifted tax secrecy led to a reduction of 40 to 44 months. Also contrary to initial expectations, each additional plea bargaining defendant within each case is associated with a reduction of about 6 months. Finally, as expected, plea bargainers saw average prison sentences rise by 23 months in Model 2C. This increased sanction for plea bargainers must be read with caution, though, because it reflects the sentence before any benefits were conceded by the court. In other words, this longer sentence time is artificial, since at the end of the day, plea bargaining defendants actually saw their sentences reduced rather than extended.