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SAO PAULO, July 16 (Reuters) - Federal prosecutors in Brazil have opened a formal inquiry into whether former President Luiz Inácio Lula da Silva improperly used his connections overseas to benefit Latin America's largest engineering firm, Odebrecht SA, a spokeswoman said on Thursday.
In May, prosecutors in Brasilia said they had opened a preliminary investigation into the matter, saying the popular former leader had frequently traveled abroad at Odebrecht's expense after leaving office in 2011.
A spokeswoman for Lula's institute, the Instituto Lula, said the institute was surprised by the news, and thought the inquiry had been escalated too quickly. The institute said it would prove the travels were completely legal.
The investigation comes a month after Brazil-based Odebrecht's chief executive officer, Marcelo Odebrecht, was arrested. Prosecutors say his family-run conglomerate may have helped lead what they called a cartel of engineering firms accused of fixing prices and overcharging state-run oil firm Petroleo Brasileiro SA. (Reporting by Caroline Stauffer and Tatiana Ramil; Editing by Peter Galloway)