"On 9 June 2019, The Intercept published leaked Telegram messages between the judge in Lula's case, Sérgio Moro, and the Operation Car Wash lead prosecutor, Deltan Dallagnol, in which they allegedly conspired to convict Lula to prevent his candidacy for the 2018 presidential election"
That judge then went on to be appointed by Bolsonaro.
Perhaps the locals cheering on Lula aren't as convinced as you are about him being corrupt.
He is also popular because his Bolso Familia program wiped out huge amounts of hunger. Poverty in Brazil dropped by a dramatic 27% during Lula's first term. So of course he has supporters.