BRAZILIANS FEAR FIGHT BETWEEN DRUG LORDS

Jailed gang leader seizes control of prison, kills rival inmates

RIO DE JANEIRO, Brazil - When Brazilian authorities locked up Luiz Fernando
da Costa in a top-security prison last year, the notorious drug lord seemed
to be out of circulation at last.

Instead, the confinement barely slowed him down.

From his cell in Rio de Janeiro's Bangu I Penitentiary, da Costa has
continued to run his drug empire, command gang wars and executions, even
negotiate arms deals by mobile phone.

"I'm in jail, not dead," he once warned gang members in a taped conversation
from a smuggled phone.

Just how little his conviction has deterred him became brutally clear on
Wednesday, when da Costa and his followers seized control of the prison,
taking eight hostages and executing four rivals.

His goal, authorities say, was to crush opponents who are fighting for
control of Brazil's organized crime, an underworld known to Brazilians as
"the parallel power."

"The objective wasn't escape," said Roberto Aguiar, Rio de Janeiro state
security chief.

Aguiar said Da Costa wanted to unite drug traffickers under one leader.
"Anyone who opposed this was eliminated."

Among them was Ernaldo Pinto de Medeiros, a leader of the Third Command, a
drug gang that challenged da Costa's Red Command. Medeiros was tortured and
burned alive. Three of his lieutenants were executed; other supporters swore
allegiance to da Costa.

After the killings, a red flag was hung from a prison watchtower to signal
the new order.

Da Costa then released the hostages-- four guards and four employees of a
construction company working in the prison -- and surrendered.

Da Costa's interests -- and ambitions -- go far beyond Rio.

Better known as Fernandinho Beira-Mar, Portuguese for "Seaside Freddy," he
was captured last year in the jungles of Colombia, where he allegedly
supplied Colombian rebels with weapons in return for cocaine that he sold in
Brazil.

In prison, he was taped negotiating the purchase of a Stinger anti-aircraft
missile.

Aguiar accused prison officials of helping da Costa, who had two pistols
when the rebellion started.

State Gov. Benedita da Silva fired the warden, suspended 12 guards and
announced da Costa would be put in solitary confinement.

"We hope this restores the rule of law," she said.

It may not be so easy. From their strongholds in the city's maze-like
shantytowns, Rio's drug lords wield near-absolute power, using favors and
terror to command obedience from hundreds of poor communities. Armed with
high-powered automatic weapons, they defy police -- or buy their protection.

In June, traffickers in Rio kidnapped, tortured and executed a prominent TV
journalist who had done exposes on the drug trade. Despite a huge manhunt,
the suspected gang leader is still at large.

On Wednesday, when word leaked out that Medeiros had been killed, gang
members ordered stores and schools in nine communities to pay their respects
by closing early. They obeyed.

"Does a parallel power exist? Yes. The state can no longer deny it," said
state District Attorney Jose Muinos Pineiro. "And it already has expanded
across state lines."

Police agree the bloodshed probably won't end at Bangu.

"There are important bandits still on the street," said federal police
director Marcelo Itagiba. "This was just one stage of the process."