São Paulo Mayor Ricardo Nunes said on Monday (Sept 14) that the city's free internet program in poor outskirts neighborhoods may be shut down if the STF, Brazil's Supreme Federal Tribunal, orders the contract with an NGO run by businesswoman Karina da Gama to end. Gama produced "Dark Horse", a film about former president Jair Bolsonaro. The statement came days after Justice Flávio Dino froze all public payments to entities linked to her.
The deal with the Instituto Conhecer Brasil (ICB), which Gama chairs, was signed in June 2024, months before the municipal election Nunes won. According to G1, the contract was worth 108 million reais to install 5,000 free wi-fi points in peripheral areas. The NGO installed 3,200 points and received 113.9 million reais from the city over two years, through May. In a WhatsApp message to reporters, the mayor said Prodam, the city's data processing company, cannot run the service at the price paid to the NGO.
"Prodam cannot do the service at a price of 1,260 reais per point. I will have to cancel and run a new call for proposals. The same service done by Prodam costs 6,699.99 reais per point."
What the investigation says
In a Sept 3 ruling, Dino ordered payments halted to all entities linked to Gama. On Thursday (Sept 10), federal police served 49 search and seizure warrants in an operation called Make Up. Targets included Gama, also a partner at Go Up Entertainment, the producer of "Dark Horse", and federal deputy Mario Frias (PL-SP), who reportedly directed 2 million reais in congressional budget earmarks to the institute, according to CNN Brasil. Investigators are examining suspected embezzlement, document fraud, money laundering, criminal organization and bid irregularities. Dino also moved the inquiry, previously handled by the São Paulo state Civil Police, to the federal police under Supreme Court supervision.
A report by the São Paulo Civil Police, made public on Sunday (Sept 13) after the justice lifted the secrecy order, points to "consistent suspicions" of commingling of assets. According to the document, the state audit court had flagged at least 20 serious irregularities in the procurement process.
"There are consistent suspicions of asset commingling and that public funds from the WiFi Livre SP program were diverted to finance the production of the film, using accounts of subcontracted companies and of other social organizations managed by the person under investigation to launder money taken from São Paulo's public coffers."
Defense and next steps
Nunes denies any wrongdoing. On Friday (Sept 11), he told CNN Brasil he would ask the STF whether the contract must be broken and insisted the city deal is separate from the film. "Our contract has nothing to do with 'Dark Horse'", he said. In Monday's message, the mayor argued the call for proposals stayed open for 30 days without any challenge, said the audit court's observations had been addressed, and called the complaint that started the case, filed by a member of the Workers' Party (PT) from the southern state of Rio Grande do Sul, "lunatic". "Nobody, not her, not a mayor, not a journalist, not a judge, is above the law. If anyone made a mistake, they must pay for it," he said.
On Monday, the city attorney's office asked Dino to reconsider the freeze, arguing that an abrupt halt could cause losses. The request is for the ICB to keep running only this contract, or for a longer deadline to switch companies. The decision now rests with the justice. If the freeze stands and no new company is hired, Nunes says he will cancel the program and open a new call for proposals, removing the 3,200 free wi-fi points now active in communities, while federal police investigate the case under Supreme Court supervision.