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O 161858Z MAY 06
FM AMCONSUL SAO PAULO
TO RUEHC/SECSTATE WASHDC IMMEDIATE 5064
INFO RUEHBR/AMEMBASSY BRASILIA 6202
RUEHRG/AMCONSUL RECIFE 2923
RUEHRI/AMCONSUL RIO DE JANEIRO 7105
RUEHAC/AMEMBASSY ASUNCION 2574
RUEHBU/AMEMBASSY BUENOS AIRES 2237
RUEHMN/AMEMBASSY MONTEVIDEO 1980
RUEHLP/AMEMBASSY LA PAZ 2798
RUEHSG/AMEMBASSY SANTIAGO 1711
RHEHNSC/NSC WASHDC
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RUMIAAA/USCINCSO MIAMI FL
RUEAWJC/DEPT OF JUSTICE WASHDC
RUEABND/DRUG ENFORCEMENT ADMIN HQ WASHDC

UNCLAS SECTION 01 OF 04 SAO PAULO 000532 
 
SIPDIS 
 
DEPARTMENT FOR DS/IP/WHA, DS/ICI/PII, DS/DSS/OSAC, WHA/BSC 
NSC FOR CRONIN 
DEA FOR OEL/DESANTIS AND NIRL/LEHRER 
DEPT ALSO FOR WHA/PDA, DRL/PHD, INL, DS/IP/WHA, DS/DSS/ITA 
BRASILIA FOR RSO AND LEGAT; RIO DE JANEIRO FOR RSO 
SOUTHCOM ALSO FOR POLAD 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PGOV PHUM KCRM SOCI SNAR ASEC BR
SUBJECT: SAO PAULO STREET WAR OVER, BUT WHO WON? 
 
REF: (A) Sao Paulo 526; (B) Sao Paulo 319; (C) Sao Paulo 42; (D) 05 
Sao Paulo 975 
 
SENSITIVE BUT UNCLASSIFIED - PLEASE PROTECT ACCORDINGLY. 
 
¶1.  (U) SUMMARY:  The three-night assault on Sao Paulo police forces 
by the organized crime gang PCC seemed to have ended Monday evening 
(May 15) as suddenly as it started.  The daily newspaper Folha de 
Sao Paulo reported on Tuesday, May 16, that the PCC leadership 
called a truce after reaching an agreement with state government 
officials regarding the status of imprisoned gang leaders.  State 
officials deny making any deals with the gang.  Regardless, life all 
but returned to normal overnight in Sao Paulo.  Almost all of the 
state's penitentiaries were under control by midnight on Monday, 
and, after an evening rush "hour" declared to be the worst gridlock 
ever experienced in Sao Paulo, streets were largely quiet through 
the night.  By Tuesday morning police barricades were being 
dismantled, and government officials declared that at least 50 
percent of the cities buses would be running, after several 
terminals had been closed and bus services canceled on Monday out of 
fear of violent attacks.  Some schools remained closed, but in 
general, May 16 looked like any given Tuesday in Sao Paulo.  State 
government officials criticized media outlets and Internet surfers 
for spreading baseless rumors on Monday of erroneous government 
advisories and PCC threats.  These rumors, officials charge, fueled 
a low-level panic across the city that led to the early closure of 
businesses and schools, and ultimately resulted in the ensuing 
gridlock that tied up the city for hours.  END SUMMARY. 
 
------------------------- 
THE DAY SAO PAULO STOPPED 
------------------------- 
 
¶2.  (U) Normalcy returned to Sao Paulo on Tuesday, May 16, as the 
war between the organized crime gang First Capital Command (PCC) and 
the Sao Paulo police (ref A) seemed to have come to an end by Monday 
evening.  Traffic on Monday remained snarled throughout much of the 
city until 9:00 p.m., and cellular telephone traffic periodically 
overloaded circuits as rumors spread throughout the afternoon that 
the government had advised residents to stay indoors or even decreed 
a curfew, and that the PCC had issued a threat that it would carry 
out random attacks on the general populace beginning at 8:00 p.m. 
Both rumors proved to have been false, leading government officials 
to decry the media and Internet surfers for spreading panic. 
Nonetheless, several buses were burned throughout the day and the 
police did engage suspects in several gun battles, resulting in some 
20 deaths, including three police officers. (NOTE: We erroneously 
reported that Congonhas Airport had suspended operations during the 
course of a bomb scare.  Apparently flights were not halted during 
the sweep, but rather, people were rushed through security 
checkpoints into boarding areas, and stores and other public access 
areas were cleared until it was determined that no bomb existed.  A 
few incoming flights may have been cancelled by airlines.  END 
NOTE.) 
 
¶3.  (U)  The rumors, coupled with images of burning buses carried 
live on television, led many store owners, mall operators and other 
businesses to close early Monday afternoon, resulting in a mass 
exodus around 4:00 p.m. onto Sao Paulo's roadways, which can become 
overburdened with routine traffic on any given day.  Further, with 
five bus companies refusing to operate and several key bus terminals 
closed, an estimated three million people who rely on public 
transportation found themselves scrambling for rides or walking long 
distances in search of the few bus lines still running.  Within an 
hour the city became gridlocked in a manner worse than most 
Paulistanos (as the city's residents are called) can remember; for 
example, many Consulate staff simply returned to the compound to 
wait out the gridlock after having moved only a few blocks in 30 
minutes.  But as the traffic eased and nightfall descended, Sao 
Paulo remained relatively quiet, and it seemed that the bloody 
attacks of the previous three nights would not reappear for a 
fourth. 
 
SAO PAULO 00000532  002 OF 004 
 
 
 
--------------------- 
TRUCE OR CONSEQUENCES 
--------------------- 
 
¶4. (U) The major daily newspaper Folha de Sao Paulo reported on 
Tuesday, May 16, that a truce was called by the PCC after its 
leaders negotiated acceptable terms for their confinement in the Sao 
Paulo prison system.  State government officials deny that it made 
any deals with the PCC, stating emphatically, "We do not negotiate 
with bandits."  Nonetheless, peace did come rather quickly to Sao 
Paulo streets.  Particularly noticeable was the sudden cessation of 
prison riots; on Monday morning, 46 of 144 prison facilities 
reported ongoing riots with hostage situations (after a peak of 71 
such riots on Sunday, May 14), and television stations showed 
footage of these throughout the day.  But by 8:00 p.m. the number of 
riots had dropped to six, and by midnight all but two prisons were 
under the control of state authorities.  Folha reported that PCC 
leaders gave an order of truce via cell phone that was to have taken 
effect at 4:00 p.m., and that the word quickly spread through the 
prison population, largely controlled by the PCC (ref B). 
 
¶5.  (SBU) State police also appeared to have regrouped during the 
day on Monday, May 15.  The Commandant General held a mid-afternoon 
press conference to appeal for calm and assert that he would have 
sufficient forces out at night to combat the unprecedented violence 
in what he described as a "state of war."  In that vein, Poloff 
witnessed a group of four to six police officers detain two suspects 
in a tactical maneuver that took place in the street alongside a 
public bus and near a police station. The officers, dressed in 
plain-clothes and armed with both handguns and shotguns, appeared 
suddenly in the vehicle lanes among the commuters stuck in traffic 
on a six-lane boulevard.  While several officers surrounded the 
suspects with weapons drawn and aimed, others forced the two men to 
the ground and then brought them to their feet with their hands 
behind their heads.  It was unclear whether the men had been walking 
between the cars in traffic or were pulled from a vehicle near the 
bus, but the police officers acted swiftly and decisively, and the 
entire incident lasted less than two minutes during a period when 
traffic was at a complete standstill.  (NOTE:  RSO suggests this may 
have been the work of one of Sao Paulo's tactical anti-organized 
crime units, which may have been dispersed throughout the city in 
unmarked vehicles for the purpose of disrupting criminal attacks 
before or as they happen.  END NOTE.)   Television news footage and 
print photographs show that police presence had been beefed up at 
government facilities and on overpasses with sightlines to potential 
hotspots, and masked police with assault weapons and shotguns had 
been dispersed at the airports, although Consulate staff reported 
seeing no noticeable increase in security at Guarulhos International 
Airport on Monday evening. 
 
---------------- 
NORMALCY RETURNS 
---------------- 
 
¶6.  (U) On Tuesday morning, May 16, state officials declared that at 
least 50 percent of the city's buses would be running, and police 
barricades around police stations had been removed in some areas. 
Public schools were mostly open, but many private schools and 
universities that announced on Monday afternoon that they would be 
closed on Tuesday remained so, mostly as parents and administrators 
assessed the security and transportation situation throughout the 
city.  Businesses seemed to open as usual, if a bit slowly.  While 
the Sao Paulo State Stock Exchange (BOVESPA) had terminated its 
after-hours trading session early on Monday, there is no indication 
that financial markets and banks would alter normal operations on 
Tuesday.  In short, life in Sao Paulo appears to have returned to 
normal. 
 
-------------------- 
SO, WHO WON THE WAR? 
-------------------- 
 
SAO PAULO 00000532  003 OF 004 
 
 
 
¶7.  (U) The question remains, what was this incredible wave of 
violence really about, and what was the result?  Best estimates now 
put the total number of attacks against police and public security 
targets, public buses, banks and other properties at 274 over four 
days (Friday, May 12 through the end of Monday, May 15).  Almost 100 
deaths associated with the attacks and related prison rebellions 
were reported, 40 or more involving law enforcement officers and 
just under 40 involving suspects.  Four innocent civilians were 
killed, and a dozen or more inmates died in prison riots, either by 
police attempting to quell the violence or at the hands of other 
inmates.  Several other states experienced spill-over violence, 
primarily from prison uprisings coordinated with those in Sao Paulo 
or in solidarity with them.  One gruesome photo in Tuesday's Folha 
shows an inmate in the state of Mato Grosso do Sul holding up the 
severed head of a fellow inmate.  It is not clear why he was 
killed. 
 
¶8.  (SBU) For the PCC, it may be that gang leaders simply wanted to 
demonstrate their power in the over-burdened, under-staffed state 
prison system, and throughout the favelas and working-poor districts 
that dot greater Sao Paulo.  Once unleashed by their leaders behind 
bars, PCC followers on the streets may have taken revenge on the 
police they knew, thus hitting targets primarily in the periphery of 
Sao Paulo proper, and often killing officers while off-duty and 
unarmed.  It seems there is a tacit understanding that a level of 
criminality behind bars will be tolerated, in no small part because 
the police and prison system are largely incapable of stopping it. 
The PCC may have demonstrated just how independently it believes it 
has a right to operate; in other words, the prison authority's 
decision to transfer 750 PCC leaders to isolated facilities and to 
lock up its titular head in maximum security (ref A) would not be 
tolerated without a flexing of muscle.  (NOTE: A case study of the 
precariousness of the prison system in Sao Paulo is the release of 
10,000 inmates last Friday on furlough for Mother's Day (ref A). 
RSO was told by one police source that the street battles would 
likely end by Tuesday, May 16, because those inmates, thought to be 
focal points in the weekend attacks, were due to return to their 
prisons by 2:00 p.m. Monday.  The re-incarceration of these inmates 
would be voluntary, but was fully expected by State officials.  We 
have no information regarding the rate of compliance.  END NOTE.) 
 
¶9. (SBU)  From a public safety standpoint, the result of the 
violence is a battered police force that managed to persevere during 
what had to have been one of the most trying and debilitating 
weekends faced by almost any police force.  In a city where the 
public largely distrusts its police as being overwhelmed and 
underpaid at best, and inept and corrupt at worst, public confidence 
in law enforcement fell even further as it became obvious that just 
being near police posed a danger, since they were the targets of 
murderous attacks.  Comparisons to Baghdad were frequently made by 
Paulistanos of all stripes over the weekend, and experienced 
city-dwellers warned newcomers to avoid stopping next to squad cars 
or in front of police stations while in traffic, lest you get caught 
in the crossfire. 
 
¶10. (SBU) However, this wave of brutality at the hands of highly 
organized criminal enterprises may give added impetus to efforts to 
revamp the criminal justice system and provide more resources. 
Government leaders from other states called upon the federal 
government to better coordinate efforts to combat organized crime 
and drug trafficking.  And there is renewed discussion of exploring 
methods to block cellular signals within prison facilities, in order 
to cut the key lines of communication of the PCC and other organized 
criminal operating from prison.  Such a technology option is 
necessary because prison administrators clearly cannot prevent 
corrupt guards from helping inmates acquire cell phones illicitly 
(ref B).  The State Secretary of Justice had convinced several 
cellular operators to shut down transmission towers near some 
prisons during the uprisings last weekend.  This may have disrupted 
some gang communications, but it also disrupted the communications 
of nearby residents.  The president of the Bar Association of Brazil 
 
SAO PAULO 00000532  004 OF 004 
 
 
criticized a proposal by Sao Paulo Governor Claudio Lembo to have 
police monitor the telephone conversations between prison inmates 
and their lawyers.  The Governor suggests that lawyers have been 
complicit in criminal activities conducted on inmates' behalf.  The 
Bar Association suggested that the government should instead present 
a list of lawyers known to be abetting crime so they can be 
disciplined and expelled from the Bar. 
 
------------------------ 
COMMENT: LESSONS LEARNED 
------------------------ 
 
¶11.  (SBU) In the immediate term, life is returning to normal in Sao 
Paulo, albeit with some trepidation.  Paulistanos are now keenly 
aware just how powerful the organized crime gangs are in Sao Paulo 
State, and how fragile is their security.  The city is taking a hard 
look inward, as local media outlets review with a certain obsession 
the worldwide media coverage of the weekend's gang attacks - which 
were of a brutality previously more commonly associated with Rio de 
Janeiro than Sao Paulo -- and as commentators blame residents for 
spreading fear and panic, causing the city to come to a standstill. 
Comparisons abound: one commentator noted bitterly that London did 
not stop in the wake of bombings last year, and another pointed to 
New York City as an example of how zero tolerance can transform a 
crime-ridden city to a welcoming business and tourist destination. 
And there is talk of better investments in the lives of children, as 
President Lula noted over the weekend, in order to reduce the need 
for costly prisons.  But ultimately in a city of 18 million people 
and a state of about 40 million, large police forces and prison 
systems are necessary, costly, and hard to manage.  Changes will 
likely be made in the margins - which can be effective, as 
demonstrated by the downward trend over the last two years in Sao 
Paulo's murder and violent crime rates - and may begin with a busy 
signal for Sao Paulo's prisoners when they switch on their cell 
phones.  END COMMENT. 
 
¶12.  (U) This cable was coordinated with Embassy Brasilia. 
 
WOLFE