Lawsuit cites irregular capital increases, links to distressed asset deals under investigation
Messages sent by Paulo Henrique Costa, former president of Banco de Brasília (BRB), indicate he may have acted improperly to benefit Daniel Vorcaro’s Banco Master by allowing capital increases that enabled the purchase of loan portfolios from the bank. The conclusion is part of a lawsuit filed by BRB on February 23 against Banco Master, Vorcaro, João Carlos Mansur, of Reag, and investment funds.
The filing points to signs of fraud, including “corporate restructuring, rapid shifts in shareholdings, and risk of asset dissipation by third parties directly or indirectly involved in Operation Compliance Zero.” It also states that BRB acquired R$26 billion in credit portfolios from Banco Master and Will Bank between July 2024 and October 2025.
The lawsuit alleges “serious irregularities in these transactions,” including approximately R$13 billion in distressed securities originated by Tirreno. It seeks to freeze BRB shares held by defendants linked to Banco Master.
Messages attributed to Costa suggest he personally selected three funds linked to Master and Reag to participate in capital injections into BRB. “It will be split into three vehicles. Please proceed with a new [subscription] of R$250 million,” one message reads.
The exchange refers to BRB’s capital increase carried out in May 2024, when the bank raised R$290 million from private investors connected to funds within the Master/Reag ecosystem, under Costa’s direct oversight.
According to the lawsuit, these actions enabled investors tied to Banco Master or mentioned in investigations to hold approximately 23.5% of BRB’s share capital by the end of 2025.
“Through capital increases carried out irregularly—featuring participation by parties that were not shareholders at the record date and involving triangulated share transactions—particularly to facilitate the acquisition of Banco Master’s credit portfolios, approximately 23.5% of BRB shares were acquired by individuals and entities with direct or indirect ties to the Master/Reag ecosystem,” the filing states.
“The funds in question ultimately have beneficiaries linked to the Master/Reag ecosystem, which justifies freezing these holdings to enable potential compensation to BRB for damages caused by the alleged fraud,” it adds.
The lawsuit further argues that funds linked to Banco Master should not have participated directly in the capital increase because they were not part of BRB’s shareholder base at the relevant record date. “Under the rules governing private capital increases, only shareholders as of May 17, 2024—the record date—were entitled to exercise preemptive rights and participate in subsequent rounds,” the filing states.
Costa was arrested last week during the fourth phase of Operation Compliance Zero. According to the Federal Police, there is evidence that he received bribes to facilitate fraudulent transactions involving Banco Master.
Investigators allege he was to receive six properties valued at R$146 million. These payments were allegedly halted after Vorcaro was improperly informed about confidential investigations involving Banco Master. Even so, authorities traced payments to Costa exceeding R$74 million.
Brazil’s Federal Supreme Court (STF) Second Panel began reviewing on Wednesday a decision by Justice André Mendonça ordering Costa’s arrest. During the same phase of Operation Compliance Zero, lawyer Daniel Monteiro—who acted on behalf of Banco Master—was also detained.
Valor contacted Costa’s legal defense, but no response was provided by the time of publication.
- By Tiago Angelo, Valor — Brasília
- Source: Valor International
- https://valorinternational.globo.com/