PF targets pension funds that invested R$1.9 billion in Master titles, says TV

The Federal Police will open new investigative fronts to investigate the sale of bonds without coverage from the Credit Guarantee Fund (FGC) to closed pension funds administered by state and municipal administrations. The information is from CNN Brazil.

The negotiation of these securities would have yielded at least R$1.9 billion to Banco Master, the target of the PF operation on Tuesday (18), which arrested the institution’s president, Daniel Vorcaro, and other executives linked to him.

According to members of the corporation, the intention is to investigate “the full extent of crimes possibly committed”, including investments made by public servants’ funds.

The PF is still evaluating whether these findings will be incorporated into the investigation opened at the beginning of 2024 or whether there will be new specific investigations, a decision that will depend on the understanding with the judge responsible for the case.

State and municipal funds

Three state governments and one capital in the Northeast invested resources in Master’s papers. The most significant case involves Rioprevidência, a fund for Rio de Janeiro employees.

The municipality invested approximately R$960 million in Financial Bills issued by the bank between October 2023 and August 2024, with due dates scheduled for 2033 and 2034.

Rioprevidência reported that it is negotiating the replacement of these papers with federal court orders and stated that the payment of retirement and pensions “is guaranteed”. He also highlighted that the amount invested is lower than the monthly cost of the payroll, currently R$1.9 billion, supported mainly by revenue from royalties and special participations.

The investment occurred even after the TCE-RJ had warned about the billion-dollar risk of the operation. Between May and July, the fund contributed resources to the bank while the institution was already facing difficulties and, months later, would enter into extrajudicial liquidation.

Risk to servers

The state and municipal funds investigated are part of their own social security schemes (RPPS), responsible for guaranteeing retirement and pensions for public servants.

High-risk applications, made without FGC protection, may compromise the future ability to pay benefits, if the amounts invested are not recovered.

The PF is also analyzing the possibility of changing the venue of the investigation, currently conducted in the Federal Court of Brasília. With the progress of the investigations and the eventual identification of authorities with jurisdiction prerogative, the case may be referred to a higher court.

The investigations continue in parallel with the extrajudicial liquidation ordered by the Central Bank, which removed former administrators and made the assets of Master’s controllers unavailable.