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Master Bank Is Liquidated by the Central Bank, and Owner Is Arrested by the Federal Police. Investors up to R$ 250 Thousand Are Covered by FGC; Above That, They Enter the Liquidated Assets and May Incur Losses
The Central Bank’s decision to declare, on this Tuesday (18), the judicial liquidation of Master Bank immediately ends the institution’s operations and determines its removal from the National Financial System. The measure came just hours after Fictor Group signaled interest in acquiring Master, a negotiation that was completely discarded after the official announcement from the Central Bank.
From this moment on, all customers and investors of the bank will follow different rules depending on the type of application, the amount held at the institution, and whether or not there is coverage by the FGC (Credit Guarantee Fund).
Investors Covered by the FGC
Those holding up to R$ 250 thousand in products covered by the FGC are protected. Economist Patricia Palomo from Arau Consulting explains that these investors will have access to reimbursement through the official fund app.
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The procedure involves three steps:
- access the FGC app,
- register,
- fill in the details to request the guarantee.
This tool, however, is not yet available for the specific case of Master. Before that, the liquidated institution needs to update its creditor base so that the FGC can process the requests. According to Palomo, the Central Bank usually takes a few weeks analyzing these requests, and only then PortoCred, the institution responsible for payments, begins releasing the funds, which may occur in up to a month.
Who Is Above the FGC Limit
For investors with amounts exceeding the coverage limit or who hold investments not protected by the fund, the situation is different. According to the Central Bank, it will only be possible to know if there will be a financial loss after a complete analysis of the assets and the financial health of the group to which Master belongs. This assessment is conducted by the liquidator, appointed by the Central Bank.
Investors who had securities and financial assets held at the group’s brokerage must also take action: they must inform the liquidator of another brokerage name to which they wish to transfer their assets. The securities cannot remain under the custody of the liquidated institution.
Credits exceeding the FGC limit enter the standard bankruptcy process: they depend on the collection of assets, the conversion of these assets into cash, and the preparation of the creditor framework. Until all this is completed, there is no prediction of amounts or deadlines.
Open Operations and Pending Balances
Those with derivative operations or asset loans must contact the liquidator to close them. If there is any financial obligation arising from transactions involving securities, the investor must fulfill it according to the terms of the signed contracts.
The transfer of custody follows the rules of B3 and the chosen brokerage to receive the assets. Clients with unsettled balances in current accounts need to formally register with the liquidator. The reimbursement depends on determining the amounts and available resources. If the existing amount is insufficient to cover all creditors, pro rata distribution will be carried out, respecting the order provided in the Bankruptcy Law.
When There Is Real Possibility of Loss
The Central Bank states that, in some situations, the investor can resort to the MRP (Loss Reimbursement Mechanism), administered by BSM, the market supervisor of B3. The mechanism covers specific cases, such as:
- amounts sent to the brokerage and not applied;
- operations conducted without the investor’s authorization;
- irregular use of the client’s securities as collateral in third-party operations;
- serious failures in the registration or formalization of operations.
If the compensation limit is insufficient and if the liquidation does not generate adequate resources to cover all losses, the investor may indeed incur losses.
The Federal Police Operation That Led to the Arrest of the Master Owner
The crisis affecting Master Bank took a new turn on Monday night (17), when the Federal Police arrested the owner of the institution, Daniel Vorcaro, at São Paulo’s Guarulhos International Airport. He was about to board a flight to Dubai, where he intended to close deals.
The operation is part of Operation Compliance Zero, which investigates a scheme involving the issuance of fake credit securities by financial institutions. The crimes being investigated include fraudulent management, reckless management, and organized crime.
In total, the Federal Police is executing five preventive arrest warrants, two temporary arrest warrants, and 25 search and seizure warrants in São Paulo, Rio de Janeiro, Minas Gerais, Bahia, and the Federal District. Also arrested was Augusto Lima, Vorcaro’s partner. The president of BRB (Banco de Brasília), Paulo Henrique Costa, has been searched and seized and was removed by judicial order.
The investigations began in 2024, after the Federal Public Ministry requested inquiries into possible credit portfolios fabricated without real backing. According to the complaint, these assets were sold to another institution and later replaced with new securities without technical evaluation, following inspections by the Central Bank itself.
CNN reported that it is still trying to contact Master Bank and Daniel Vorcaro’s defense.
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