The United States Court recognized this Thursday (8) the extrajudicial liquidation of Banco Master decreed in Brazil and ordered the freezing of assets of the institution and its subsidiaries in American territory. The decision was made by Judge Scott M. Grossman, of the Bankruptcy Court for the Southern District of Florida, and represents a reinforcement of the Central Bank’s (BC) role in the case.
The recognition was granted at the request of EFB Regimes Especiais de Empresas, appointed by the BC as liquidator of Banco Master. The judge classified the Brazilian liquidation as a “main foreign proceeding”, under Chapter 15 of US legislation, which obliges American courts and creditors to respect the progress of the process conducted in Brazil.
With the decision, all legal actions, debt enforcement and any attempt to transfer or move Banco Master’s assets in the United States outside the control of the liquidator are suspended.. The order also reaches LetsBank SA, Banco Master de Investimento SA and Master SA Corretora de Câmbio, Títulos e Valores.
“All persons and entities are prohibited from transferring, encumbering or otherwise disposing of any debtor assets located in the United States,” the judge stated in the order.
Grossman rejected the requests presented by Daniel Vorcaro, former controller of the bank, who claimed that the liquidation could be reversed in Brazil, especially due to questions at the Federal Audit Court (TCU). For the judge, the Brazilian process is regular and the liquidator is “duly authorized” to represent the institution abroad.
The decision also grants the EFB broad powers to operate in the USA, including the possibility of hearing witnesses, producing evidence and requesting information about the assets, businesses, rights and liabilities of the bank and its subsidiaries.
TCU
The decision came hours after minister Jhonatan de Jesus, from the Federal Audit Court (TCU), suspend an in-person inspection at the Central Bank related to the Master settlement. Citing “disproportionate contours” after the “wide publicity of the case”, the minister took the issue to the court’s plenary for analysis.
Banco Master had the settlement decreed by the BC in November, after the rejection of the sale proposal to Banco de Brasília (BRB) and in the context of Operation Compliance Zerofrom the Federal Police, which investigates suspicions of financial fraud involving the former administration of the institution.
