Supreme Court justices meet with bank representatives

Justice Cristiano Zanin met Tuesday (19) at 6:30 p.m. with Rodrigo Maia, former speaker of the Chamber of Deputies and now president of the National Confederation of Financial Institutions (formerly CNF, now FIN). The two had already met earlier this month after Mr. Zanin was appointed rapporteur in a case seeking to prevent the STF from allowing the blocking of Justice Alexandre de Moraes’s bank accounts. Since Monday, other justices have also met with bank representatives.

According to reporting by Valor, banks remain uncertain about the full scope of Dino’s decision. On one hand, they fear sanctions from the United States; on the other, fines from the Supreme Court should they fail to comply with the Brazilian order.

The ruling has fueled uncertainty in the sector. On Tuesday (19), the day after Mr. Dino’s move, banks lost more than R$38 billion in market value amid concerns that the justice’s reaction could trigger stricter enforcement of the law by the Donald Trump administration. Shares partly recovered yesterday.

Bankers head to Brasília

Through industry associations, financial institutions have been lobbying in Brasília to defuse tensions as relations between Brazil and the U.S. escalate.

Mr. Zanin is handling a case filed by Federal Deputy Lindbergh Farias (Workers’ Party, PT, Rio de Janeiro), leader of the PT in the lower house, requesting that the STF prevent Brazilian banks from blocking Mr. Moraes’s accounts. The justice was sanctioned in July under the Magnitsky Act.

On August 1, Mr. Zanin referred the matter to the Office of the Prosecutor General (PGR) and is awaiting its opinion. He has signaled that he intends to hear all parties involved, including banks, before issuing any ruling.

Earlier this month, Justices Gilmar Mendes and Moraes also held meetings with bank representatives, with the consensus at the time being that no accounts would be blocked. Should moves in that direction occur, however, the STF could step in to stop the enforcement of the Magnitsky Act in Brazil—as Mr. Dino effectively did on Monday (18). His ruling, though, came in a case unrelated to U.S. sanctions, instead involving lawsuits filed by Brazilian municipalities in the United Kingdom over environmental disasters.

Dino pushes back with irony

Justice Dino on Wednesday (20) mocked the financial market’s reaction to his ruling against the immediate enforcement in Brazil of foreign laws, rulings, and administrative acts. “I issued a decision yesterday [Tuesday] and the day before [Monday]. The one they say crashed the markets. I didn’t know I was so powerful: R$42 billion in financial speculation. Fortunately, age teaches you not to be impressed by small things. Obviously one thing has nothing to do with the other.”

“We should not be swayed by foam. This was a ruling for a specific case. The first technical challenge is understanding. A decision on acts by the U.S. has nothing to do with a drop in the stock market,” he added.