In short:
Jair Bolsonaro has been indicted for alleged money laundering and criminal association over undeclared diamonds from Saudi Arabia.
Mr Bolsonaro reportedly attempted to sneak a $US3.2 million ($4.75 million) stash of the diamonds into Brazil, then secretly sell two luxury watches in the United States.
What's next?
Once the federal police report reaches Brazil's Supreme Court, the country's Prosecutor General will decide whether to file charges.
Former Brazilian president Jair Bolsonaro has been indicted for money laundering and criminal association in connection with undeclared diamonds from Saudi Arabia, two officials confirmed to the Associated Press.
Last year, federal police investigated Mr Bolsonaro and a number of military officials on suspicion of attempting to sneak diamond jewellery into the country and sell some items in the United States without declaring the sale.
The items — some of which were made by Chopard of Switzerland — included a diamond necklace, ring, watch and earrings given to Mr Bolsonaro and former first lady Michelle Bolsonaro by the Saudi Arabia government.
The stash is estimated to be worth $US3.2 million ($4.75 million).
Customs officials seized some items at São Paulo-Guarulhos International Airport in October 2021 when the stash was found in the backpack of a government aide returning from Riyadh, Saudi Arabia.
Brazil requires its citizens arriving by plane from abroad to declare goods worth more than $US1,000 and, for any amount above that exemption, pay a tax equal to 50 per cent of their value.
The jewellery would have been exempt from tax had it been a gift from Saudi Arabia to the people of Brazil.
However, Mr Bolsonaro intended to keep the stash for himself.
Police said in August Mr Bolsonaro received cash from the nearly $US70,000 sale of two luxury watches he received as gifts from Saudi Arabia.
The investigation showed Mauro Cid, Mr Bolsonaro's former aide-de-camp, sold a Rolex watch and a Patek Philippe watch to a store in the US for a total $US68,000 in June 2022.
Mr Cid later signed a plea bargain with authorities and confirmed it all.
Federal police indicted Mr Bolsonaro on Thursday, but Brazil's Supreme Court has yet to receive the police report.
Once it does, the country's Prosecutor General Paulo Gonet Branco will analyse the document and decide whether to file charges and force Mr Bolsonaro to stand trial.
Detractors call indictment 'blatant and shameless'
Police reportedly indicted 10 others in addition to Mr Bolsonaro, including Mr Cid and two of his lawyers.
One of Mr Bolsonaro's lawyers, Frederick Wassef, released a statement insisting he didn't have access to the investigation's final report.
He also claims the press has received selective leaks on a case which is supposed to proceed under seal.
"I am going through all of this solely for practising law in defence of Jair Bolsonaro," he wrote.
Mr Bolsonaro's other lawyer Fabio Wajngarten took to X, calling the indictment "arbitrary, unfair and persecutory".
"The federal police knows I did nothing related to what they are investigating, but they still want to punish me because I provide unwavering and permanent defence for former president Bolsonaro," he said.
He insisted he advised Mr Bolsonaro to return the diamond jewellery to Brazil's audit court at the time.
Flávio Bolsonaro, the former president's eldest son and a sitting senator, also took to X after Thursday's indictment to call persecution against his father "blatant and shameless".
Mr Bolsonaro did not immediately comment, but he and his lawyers have previously denied any wrongdoing in the case and other investigations into the former president.
The money laundering indictment marks the far-right former leader's second formal accusation, with more potentially in store.
In May, Mr Bolsonaro was formally accused of falsifying his COVID-19 vaccination certificate.
Last year, Brazil's top electoral court ruled that Mr Bolsonaro abused his presidential powers during his 2022 re-election bid, which rendered him ineligible for any elections until 2030.
The case focused on a meeting during which Mr Bolsonaro used government staffers, the state television channel and the presidential palace in capital Brasília to tell foreign ambassadors the country's electronic voting system was rigged.
One investigation is probing his possible involvement in inciting an uprising in Brasília on January 8, 2023 that sought to oust his successor from power.
Experts predict more legal action ahead
The 69-year-old former army captain started his political career as a staunch advocate of Brazil's military dictatorship, and was a lawmaker for nearly three decades.
When he bid for the presidency for the first time, in 2018, he was widely dismissed as an outsider and too radically conservative.
But he surprised analysts with a decisive victory, in no small part due to his self-portrayal as an upstanding citizen in the years following a sprawling corruption probe that ensnared hundreds of politicians and executives.
Mr Bolsonaro insulted adversaries since his earliest days in office while garnering critics with his divisive policies, attacks on the Supreme Court and efforts to undermine health restrictions during the pandemic.
He lost his re-election bid in the closest finish since Brazil's return to democracy in 1985.
Mr Bolsonaro retains staunch allegiance among his political base.
In February, an estimated 185,000 people clogged Sao Paulo's main boulevard to protest what the former president calls political persecution.
His critics, particularly members of his rival President Luiz Inácio Lula da Silva's political party, have cheered every advance of investigations and repeatedly called for his arrest.
Insper University Political Science Professor Carlos Melo believes the justice overseeing investigations targeting Mr Bolsonaro, Alexandre de Moraes, will not risk sending the former president to prison or imposing other harsh measures.
The objective, Mr Melo said, is to avoid instigating supporters of the far-right leader and so make cases against him more politically sensitive to prosecute.
"This is a year of mayoral elections. Moraes and his fellow justices know that prosecuting a former president who remains a popular man would be even tougher in a year like this," Mr Melo said.
"This indictment is another piece of the puzzle. It gives one more problem to Bolsonaro. There will be more."
AP/ABC