Brazilian President tearful after inquiry links him with post office corruption

Stunned by the revelations, a tearful President, known as Lula, reportedly told ministers: "My heart is hurting."

The disclosure about Lula's alleged ties to the corruption scheme came during a session of the parliamentary inquiry into corruption within the Post Office. In a statement to the inquiry Duda Mendonça, Lula's former spin-doctor, admitted opening an offshore account in the Bahamas in order to pay off debts of around R$10m (£2.3m) from the 2002 election campaign.

As Mendonça spoke, several Workers' Party (PT) deputies wept openly. "This is the one of the saddest days of my life," Walter Pinheiro, a PT federal deputy, told reporters.

The "mensalão", or big monthly scandal, by which politicians allegedly received payments of R$30,000 (£7,300) to back the ruling coalition, has shaken the PT to the core. Since April five members have lost their posts.

Yesterday, there was growing talk in Congress of Lula's impeachment. "It is no longer possible to sell this image of a Lula who knew about nothing," said Gustavo Fruet, a federal deputy for the Social Democratic Party.

Political analysts remain cautious. "For impeachment you would need to prove the President was directly involved or knew what was going on. Then we would be talking about a crime of responsibility," said Amaury de Souza of Rio-based MCM Consultores.