A Portuguese judge on Monday charged former Prime Minister Jose Socrates with corruption and tax fraud and ordered that he remain in preventive custody.
Socrates' arrest on Friday shocked the country and his Socialist party, which hopes to win next year's election.
As a court official read out the judge's decision late on Monday, Socrates' lawyer, Joao Araujo, told reporters he considered it "unfair and unjustified" and said he would appeal.
Criminal Judge Carlos Alexandre, who presides over several separate high-profile investigations, delivered his decision after a three-day questioning marathon over suspected tax fraud, corruption and money-laundering.
The detention is the first involving a former premier in Portugal under democracy and follows other loud cases this year as prosecutors and judges intensify a fight against corruption in a country notorious for its slow justice system.
Police arrested Socrates, 57, who was premier between 2005 and 2011, at Lisbon airport late on Friday as he arrived from Paris where he has been living after his resignation.
Three other individuals linked to Socrates were also arrested, including his driver. Citing leaked police materials, local media said the driver is suspected of having transported large sums in cash by car from Portugal to Socrates in Paris.
Some analysts say the charges could upset the Socialists' hopes of winning full majority in parliament next year, if not the likelihood of the party winning the election.
Boosted by the September election of a new leader, Lisbon Mayor Antonio Costa, the party has extended its lead over the centre-right ruling coalition in voting intention polls, but it is still shy of popularity levels that would give it full majority. Costa was once a minister in a Socrates cabinet.
"To be sure, Socrates' detention considerably diminishes the probability of a Socialist absolute majority," said Antonio Barroso, senior vice president at Teneo Intelligence consultants in London. "The event is likely to tighten the electoral race."
The government has also been rattled by recent inquiries after the arrest of the immigration service chief earlier this month on suspicions of corruption linked to the issuing of "golden visas" to wealthy foreigners forced the interior minister, Miguel Macedo, to step down.
The crime of corruption carries a prison term of up to eight years. It was not clear if the inquiry, known as "Operation Marquis," was linked to Socrates' time as premier in 2005-2011.
Socrates resigned as prime minister in the middle of his second four-year term in 2011 as an escalating debt crisis forced him to request an international bailout, which imposed painful austerity on Portugal.
During his premiership, Socrates weathered several investigations, including allegations that he misused his post as environment minister in 2002 to allow the construction of a shopping mall. He denied wrongdoing and faced no formal charges.
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