Prosecutors file charges against Lula, his wife and six others in connection to sprawling Petrobras corruption scandal.

Prosecutors in Brazil have filed charges against former president Luiz Inacio Lula da Silva, his wife and six others over a corruption scandal involving the state-run oil giant Petrobras.

Deltan Dallagnol, a public prosecutor, said on Wednesday that Lula was the “general” in command of the Petrobras corruption scheme that caused an estimated $12.6bn in losses.

Lula’s lawyers said in a statement that he strongly denied the allegations and would fight the charges.

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He could face arrest for allegedly receiving a luxury apartment on the coast of Sao Paulo from one of the engineering and construction firms at the centre of the bribery scandal.

Lula, 70, has denied ownership of the three-storey apartment in the city of Guaruja.

Federal police urged prosecutors last month to bring charges against Lula and his wife, accusing them of receiving more than $700,000 in benefits from the builder OAS in relation to the apartment.

Lula, a former union leader who was a two-term president from 2003 to 2010, has separately been indicted by a court in Brasilia for obstruction of justice in a case related to an attempt to persuade a defendant in the Petrobras scandal not to turn state’s witness.

Lula’s fall, and that of the leftist party he founded in 1980, has been dramatic.

A one-time shoeshine boy and union leader who led massive strikes against Brazil’s military dictatorship, contributing to its downfall, he was elected the nation’s first working-class president in 2002 after three failed campaigns.

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Wildly popular with Brazil’s poor, Lula’s social policies helped lift millions out of poverty and into the middle class, and he left office in 2010 with an 83 percent approval rating and an economy that grew at an impressive 7.5 percent.

But two years ago, as the Petrobras probe became public, prosecutors began to slowly put Lula in their crosshairs.

Many prosecutors and investigators say they cannot imagine such a powerful figure was unaware of the institutionalised corruption and political kickbacks taking place at Petrobras and other state-run companies.

But, recent polls have shown that despite the investigations targeting Lula and the Workers Party, he would be a favourite to win the next presidential election.

Lula says he has not ruled out running again for president in 2018, but a criminal conviction would bar him from being a candidate for the next eight years.

Last month, his protege and successor as president, Dilma Rousseff, was removed from office in an impeachment trial.