Brazil’s Top Court Allows Police to Deepen Master Probe
(Bloomberg) — A Brazilian Supreme Court judge has expanded police access to a fraud investigation into Banco Master SA, effectively allowing authorities to deepen the probe that has shaken the country’s political and financial systems.
In a decision handed down Thursday night, Judge Andre Mendonca authorized the federal police to conduct routine investigative procedures in the Master case, including interviewing suspects and witnesses. It also eased privacy restrictions and allowed authorities to share investigation-related documents internally to speed up their work.
On Friday, Mendonca ruled that evidence related to Master and other fraud investigations under the control of the Senate presidency should be returned to the parliamentary committee investigating the case, as well as to the police.
While Mendonca ruled that police would need his permission to open new fronts of investigation, Thursday’s ruling will significantly ease the restrictions imposed on the case by Judge Dias Toffoli after Brazil’s central bank liquidated Master following its own investigation into alleged financial fraud.
The decisions come at a time of intense scrutiny over Toffoli’s handling of the Master saga, which sent shockwaves through Brazil’s elite institutions and pushed the Supreme Court to the brink of its deepest credibility crisis since the country’s return to democratic rule four decades ago.
Mendonca took charge of the case last week after Toffoli abandoned oversight after a police report raised questions about his connections to the lender and its chief executive, Daniel Vorcaro.
The report alleged that Toffoli maintained a relationship with Vorcaro, an executive known for establishing ties with powerful politicians and senior officials in Brazil’s capital. Also mentioned were financial transfers in connection with the sale of a hotel facility partly owned by the justice to investment funds affiliated with Banco Master.
Toffoli has denied any wrongdoing, but the report nevertheless added to the controversy that has surrounded the case since the Supreme Court placed it under its jurisdiction late last year.
After the central bank completed its administrative investigation and passed the evidence to the police and prosecutors (a step that led to Vorcaro’s arrest and later release under electronic monitoring), Toffoli intervened, citing defense arguments that investigative measures could extend to individuals with parliamentary immunity.
He later issued a series of amendment orders regulating access to evidence; at one point he placed documents and electronic devices under the Supreme Court seal before sending them to prosecutors, ultimately restricting access to a small group of police forensic experts.
Mendonca’s decision also allowed police to retain custody of material collected during investigations, changing Toffoli’s order that it should instead go to the federal prosecutor’s office. Authorities told the court they analyzed nearly 100 electronic devices and requested greater internal access to complete their technical review.
(Updates on the Supreme Court decision published on Friday in the third paragraph.)
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