By Brazil Stock Guide – Brazil’s federal police, known locally as the Polícia Federal, on Wednesday (14) launched the second phase of Operation Compliance Zero, expanding an investigation into alleged misconduct at Banco Master. The new phase again targets the bank’s former controller, banker Daniel Vorcaro, and was authorized by Supreme Court Justice Dias Toffoli.
Federal police are executing 42 court-authorized search-and-seizure warrants across five Brazilian states, including São Paulo and Rio de Janeiro. Investigators also obtained asset freezes totaling more than R$5.7 billion, based on suspicions that funds were improperly moved out of Banco Master and into the personal assets of Vorcaro and people close to him.
Authorities say the focus of this phase is alleged fraudulent management of the bank, particularly whether Banco Master relied on investment funds managed by financial firms in São Paulo’s Faria Lima district — Brazil’s main financial hub — to carry out irregular transactions. Such funds are widely used in Brazil for treasury and financing operations, but investigators suspect they were misused to conceal losses and transfer resources.
As part of the operation, businessman Fabiano Zettel, Vorcaro’s brother-in-law, was arrested under a temporary detention order while attempting to board a private jet bound for the United Arab Emirates, according to authorities. Investigators said the arrest was intended to prevent him from leaving the country and to safeguard evidence during the execution of the warrants. Zettel’s legal team had not commented by the time of publication.
Searches are also being carried out at addresses linked to Vorcaro’s sister and cousin, as well as to businessman and investor Nelson Tanure. Authorities have not disclosed whether Tanure has been formally charged, but confirmed that the searches are connected to the broader investigation into the use of investment funds and financial intermediaries.
According to people familiar with the case, the investigation rests on two main bodies of evidence. The first comes from the initial phase of Operation Compliance Zero, which examined suspected irregularities in Banco Master’s attempted sale to Banco Regional de Brasília, a lender controlled by the government of Brazil’s federal capital. The second stems from a formal criminal referral by Brazil’s Banco Central do Brasil, which outlined indications of allegedly fraudulent financial operations involving investment funds.
Investigators believe a complex network of funds may have been used to move resources off Banco Master’s balance sheet, with the ultimate aim of transferring money to Vorcaro and close associates. Authorities are examining whether similar structures were used by other market participants now under scrutiny.
Zettel has previously drawn public attention for being one of the largest individual political donors in Brazil’s 2022 election cycle. Official records from Brazil’s Tribunal Superior Eleitoral show that he donated R$2 million to the campaign of São Paulo Governor Tarcísio de Freitas and R$3 million to the re-election bid of then-president Jair Bolsonaro. Authorities have not indicated that the donations are directly linked to the alleged financial crimes.
Bolsonaro, who lost the 2022 election, is currently serving a prison sentence following a conviction related to an attempted coup, a case that is separate from the Banco Master investigation.
In a statement, Vorcaro’s defense said he is “fully and continuously cooperating with the authorities” and will comply with all court orders. Brazilian law presumes innocence until a final conviction.
The scale of the asset freezes and the involvement of the Supreme Court underscore the potential systemic relevance of the case, as regulators and law enforcement seek to reassure markets and investors about the integrity of Brazil’s banking system and investment-fund framework.
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