The Central Bank (BC) is preparing for a counterattack from banker Daniel Vorcaro, owner of Master, in the process that resulted in the liquidation of the financial institution, according to sources familiar with the matter.
The liquidation was declared on November 18 after Vorcaro told BC that he had a plan to restructure the bank and that he had found a buyer for the bank: Fictor, a little-known company in the sector, with investors from the United Arab Emirates whose identity was never revealed.
The day after the alleged transaction was publicly announced, the authority liquidated the bank, saying the decision was based on a serious liquidity crisis, a significant deterioration in the economic-financial situation and “serious violations of the rules that govern the activity of institutions that are part of the national financial system.”
The banker is expected to try to challenge the liquidation and even demand compensation of a billion dollars, claiming that when the BC decreed it, Vorcaro would have already presented an alternative to save the bank.
Vorcaro had a meeting in November with British Columbia to present his plan. He was arrested the same day at night, while trying to board a plane abroad. According to the banker’s defense, the trip was intended to sign the agreement. For the PF, it was a way of facilitating the banker’s escape from the country.
In an order this Thursday (18), Minister Jhonatan de Jesus ordered the Central Bank to explain within 72 hours the reasons that led the regulator to decide to liquidate Banco Master, an act that the court of accounts considers an extreme measure and which could have been hasty.
According to the minister, the action of the monetary authority indicates that the BC may have taken too long to seek market alternatives for the Vorcaro bank. In addition, he suggests that the municipality could have considered less expensive solutions.
The minister also states in the order that he has identified a series of signs that indicate irregularities in the liquidation process. When contacted, the BC said it does not comment on ongoing processes by monitoring bodies. Vorcaro also has not commented.
The BC decided to liquidate Master after vetoing the sale of the bank to the public institution BRB and finding signs of fraud in the balance sheet of the private institution. After investigation, authorities said the bank could have fabricated around 12 billion reais in fake loans.
The ABBC (Association of Brazilian Banks) showed its support for the BC after the TCU demonstration. In a statement, the entity said it trusts the BC, which has highly qualified staff and technical capabilities to support its decisions. ABBC also said it is essential to preserve the autonomy and legal certainty of the Central Bank.
The TCU’s order follows a representation by the public prosecutor to the court, which found signs of failure in the monetary authority’s supervision of the Vorcaro bank. According to the public prosecutor, the BC’s actions may have been “marked by omissions and insufficient timely response to signs of financial deterioration of the institution.”
In the response he gave this week, before the TCU order, the President of British Columbia, Gabriel Galípolo, said that the authority was available to speak about the case before the STF (Federal Supreme Court).
This week, Minister Dias Toffoli ordered a series of hearings on the matter, including one with the leaders of British Columbia.
According to the head of the BC, all meetings and information about the Master are documented. “British Columbia, from the beginning, from the experience of other cases, knew that this case had to be an absolute (correct) model. A complete model. Because we need the whole process to be sustainable over time,” Galípolo said in response to journalists.
“We know that these processes usually last 5, 10, 15 years. And then, obviously, as we have done with the Public Prosecutor’s Office and the Federal Police, British Columbia, but not only British Columbia, I am, as president, available to the Supreme Court to provide all the data that we have already provided to the Public Prosecutor’s Office and the Federal Police,” he said.
A similar case, involving another bank, is currently before the courts and could create a precedent in this area. The STJ (Superior Court of Justice) determined in May that a liability action brought against the FGC (Credit Guarantee Fund) by the receivers of the bankrupt bank of Banco Cruzeiro do Sul, Laspro Consultores, will be brought before the Federal Court, as it is necessary for British Columbia to also be included as a defendant.
The plaintiffs allege that the defendants (in this case the FGC) acted with intentional or negligent intent that triggered the bankruptcy of Cruzeiro do Sul and associated institutions. They requested compensation for the damages, claiming a claim value of 2.4 billion reais.
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