Banco Master scandal reaches Brazil’s political establishment

Investigators found that Nogueira received a monthly “allowance” between R$300,000 and R$500,000 from Vorcaro, in exchange for supporting Banco Master in Congress. Additionally, Federal Police investigators determined that an amendment proposed by the senator to increase the coverage cap of Brazil’s Credit Guarantee Fund (FGC) was drafted by advisers connected to the financial institution being investigated.

In addition to Nogueira, the operation focused on his brother Raimundo Neto e Silva Nogueira Lima, Felipe Cançado Vorcaro—a cousin of Daniel Vorcaro—and Bernardo Rodrigues de Oliveira Filho. Cançado was briefly detained on suspicion of managing transfers and corporate deals related to the scheme. Nogueira Lima and Rodrigues were mandated to wear electronic ankle monitors.

The new phase of the operation began two days after Vorcaro’s lawyers submitted an initial plea bargain proposal to the Federal Police and the Office of the Prosecutor General. This proposal reportedly outlines topics the former banker is prepared to discuss with authorities in exchange for benefits like a reduced sentence or a lighter prison regime.

The proposal still requires review by investigators, who need to assess whether the information could significantly aid the case. Justice Mendonça stated that he has not yet reviewed the defense’s submissions and has therefore not formed an opinion on their contents.

However, Valor reported that investigators involved in the case remain skeptical about the agreement’s completion. Their preliminary assessment indicates that the material might be deemed “insufficient” since the Federal Police investigation—centered on cellphones and seized documents—is already in a late stage.

At the same time, Mendonça is reviewing a Federal Police request to transfer Vorcaro back to the Papuda prison complex. The former banker is currently being held in a room at the Federal Police headquarters in Brasília. The request was submitted before Vorcaro made his first proposal for cooperation.

Any plea bargain is expected to proceed only if Vorcaro provides new and relevant information that implicates institutions or public officials. Messages found on his cellphone indicate contacts with members of all three branches of government. The move against Nogueira—national president of the Progressive Party (PP) and one of the main leaders of the powerful congressional bloc known as the “Centrão”—marks the first formal step in the investigation against a sitting member of Congress.

‘Master amendment’

The main episode cited by investigators to support suspicions that Nogueira acted on Vorcaro’s behalf concerns the so-called “Master Amendment,” introduced by the senator in August 2024 during debate on a constitutional amendment proposal regarding the Central Bank’s legal framework.

The amendment raised Credit Guarantee Fund coverage from R$250,000 to R$1 million per depositor, a move widely interpreted at the time as an attempt to create a financial lifeline for Banco Master.

According to Mendonça’s decision, Federal Police investigators concluded that the amendment text had been drafted directly by the bank’s advisory team. The document was allegedly printed and delivered in an envelope addressed to Nogueira at the senator’s residence. Investigators also allege the version delivered was reproduced “in its entirety” by the senator in Congress.

Shortly after the proposal was published, Vorcaro reportedly wrote in a message that the legislative measure had come out “exactly as I instructed.” According to the investigation, associates of the former banker also said the measure could “sextuple” Banco Master’s business and trigger a “catastrophe” in the financial market.

Nogueira’s lawyer, Antônio Carlos de Almeida Castro said in a statement that the senator “rejects any insinuation of illegality regarding his conduct, especially in his parliamentary activity.” According to the attorney, Nogueira is committed to cooperating with authorities “to clarify that he had no involvement in illegal activities or in the facts under investigation.”

In a statement, the Progressive Party said it expects the facts “to be properly clarified, with full respect for due process and the right to a defense.” The party also expressed confidence in Brazil’s institutions and judicial system.

Police suspect broader favors

Federal Police investigators argue that the “Master Amendment” was not an isolated incident. In November 2023, Vorcaro allegedly ordered the removal of envelopes containing draft bills tied to private interests from Nogueira’s residence. According to investigators, the documents were taken to an office designated by the former banker, reviewed by the banker’s associates, and later delivered to a congressional aide connected to the senator.

The proposals cited in Mendonça’s ruling involve Brazil’s Energy Transition Acceleration Program (Paten) and the Brazilian Emissions Trading System. Investigators argue the circulation of the documents suggests something beyond ordinary interactions between lawmakers and the private sector. According to the Federal Police, Vorcaro instructed that the driver transporting the documents should not be linked to the senator and that the envelope should contain no reference to Banco Master.

In exchange for this alleged assistance, investigators say Nogueira received improper economic benefits. The investigation notes monthly payments that allegedly began at R$300,000 and later rose to R$500,000, as well as personal expenses allegedly paid by Vorcaro, including hotels, restaurants, private flights, and international travel. The ruling also notes the use of a luxury property and a credit card for personal spending.

A key focus of the investigation is the acquisition of a corporate stake valued at approximately R$13 million for just R$1 million. This transaction was executed via CNLF Empreendimentos Imobiliários, a company partnered with Nogueira and formally managed by his brother Raimundo, who was also involved in the operation. CNLF bought a 30% share in Green Investimentos, led by Cançado Vorcaro.

Green held a stake in Trinity Energias Renováveis. According to investigators, the alleged undervaluation is supported by the company’s dividend potential. Green reportedly received R$2.4 million in dividends from Trinity, and CNLF’s 30% share would amount to R$720,000 in a single year.

Mendonça wrote that, in a preliminary analysis, it does not appear ordinary that “mere family ties or regular political activity” would justify a transaction of this nature. According to the justice, the evidence gathered, in theory, points to a functional arrangement of mutual benefit rather than a simple friendship or a legitimate political relationship.

Golf cart escape

Felipe Vorcaro was held for five days following a temporary arrest. Federal Police investigators identify him as a key member of the alleged criminal organization, responsible for managing financial and operational activities, including corporate transactions and monthly transfers associated with the BRGD/CNLF partnership.”

In messages cited in the ruling, Felipe asks Daniel Vorcaro whether he should continue paying R$300,000 per month to the partnership. In another exchange, he asks whether the payments would remain at R$500,000 or revert to R$300,000.

The ruling also states that Felipe left a house in the Terravista condominium complex in Trancoso, Bahia, fleeing in a golf cart minutes before Federal Police agents arrived during an earlier phase of the operation launched in January. Security footage reportedly showed two men leaving the property at 5:41 a.m., and Federal Police agents appeared behind the house at 5:59 a.m.

Investigators noted that the departure seemed unusual: the bedroom door was open, the air conditioner was on, the bed sheets were disheveled, and personal belongings were left behind. However, no cellphones or computers were found.

The senator’s brother is also suspected of playing a formal and operational role in sustaining the business structure behind the alleged scheme. Although he officially became manager of CNLF only in December 2024, his name already appeared in the April contract structuring the purchase of the Green stake.

In the ruling, Mendonça suspended the economic and financial activities of CNLF, BRGD, Green Investimentos, and the Green Energia private equity fund. According to the Supreme Court justice, there are indications that these structures operated not as ordinary companies but as instruments to conceal, circulate, and formally legitimize illicit funds.

The Federal Prosecutor’s Office supported the requests made by the Federal Police. In a document submitted to the Supreme Court, prosecutors stated that the evidence shows a close personal, corporate, and financial connection among the individuals under investigation, suggesting potential private influence on a political figure’s actions.

Regarding Nogueira, prosecutors argued that the measures were necessary because of his “high potential to influence the course of the investigation, especially with regard to aligning versions, coordinating defense strategies, and circulating sensitive information.”

Valor was unable to reach the lawyers for Felipe Vorcaro, Raimundo Nogueira, and Bernardo Rodrigues for comment.