Sao Paulo ex-mayor guilty of stealing public funds

image captionPaulo Maluf is sought by Interpol after being indicted on money laundering charges in New York

The former mayor of Brazil's largest city, Sao Paulo, has been found guilty of stealing millions of dollars from public funds and diverting them to his offshore accounts in Jersey.

A court in Jersey ordered Paulo Maluf, 81, to pay back $10.5m (£6.6m) plus interest to the Sao Paulo authorities.

The court in the British tax haven island said Mr Maluf had overcharged on construction projects and channelled the money into the Jersey accounts.

He denies the charges.

According to judgment, Mr Maluf made $10.5m from issuing over-inflated invoices for construction work on an eight-lane highway in Sao Paulo during his time as mayor of the city in the 1990s.

Witness intimidation

The money ended up in the accounts of two companies linked to Mr Maluf and his son Flavio, which are held with Deutsche Bank on the island of Jersey.

Mr Maluf and his son were jailed for several weeks in 2005 for intimidating witnesses in a money laundering case against them.

He has also been indicted by a court in New York on money laundering charges and is on Interpol's red list, meaning he faces arrest if he leaves Brazil.

The son of Lebanese immigrants, Mr Maluf was mayor of Sao Paulo in the early 1990s and twice a candidate for the Brazilian presidency.

He currently serves as a Congressman for the right-wing Progressive Party.

He has denied having any off-shore accounts and says the Jersey ruling had no legal basis.

He said it was for the Brazilian justice system to determine whether there had been irregularities in the construction projects carried out there and not for a court in Jersey.

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