BRASILIA, March 24 (Reuters) – Brazil’s federal audit court TCU deferred its ruling on the Banco Master case despite the conclusion of an internal audit amid elements under review by other authorities that are necessary for its decision, the judge overseeing the case said on Tuesday.
In February, Reuters had already reported that the TCU audit did not give any recommendations regarding the central bank’s conduct in the liquidation of Banco Master in November amid a sharp liquidity crisis and alleged sale of fraudulent credit portfolios.
Without disclosing the findings of the technical review, Judge Jhonatan de Jesus said a ruling by the audit court would not be appropriate “at the risk of reaching a decision with a lower degree of completeness than desirable.”
Jesus ordered that findings from ongoing probes into the case conducted by the central bank, the Office of the Comptroller General and in a case before the Supreme Federal Court be added to the TCU proceedings.
“The existence of investigations being conducted in other spheres, using different fact-finding tools and with the potential to uncover new elements, reinforces the case for awaiting a more developed evidentiary record before this court reaches a final judgment.”
The audit court’s involvement in the case has been closely watched after Jesus signaled he could consider “precautionary” measures to prevent asset sales during Banco Master’s liquidation given the irreversible nature of such a process while the probes determine if the conduct had been appropriate.
Jesus had previously ordered an inspection of central bank documents underpinning the decision to shut down the lender.
With Tuesday’s deferral, Jesus keeps the audit court involved in shaping what may happen in the liquidation process.
The move follows revelations earlier this month of evidence that two senior regulators at Brazil’s central bank secretly advised embattled banker Daniel Vorcaro, the controller of Banco Master.
A federal police investigation found Vorcaro likely bribed former central bank director Paulo Sergio Neves de Souza and Belline Santana, a former head of the banking supervision department, in exchange for tips and document reviews, according to cellphone messages obtained through court-authorized access to communications records.
(Reporting by Marcela Ayres; Editing by Aurora Ellis)
