A historic collapse

One factor in the widespread disillusionment has been the Banco Master scandal. The financial imbroglio has delivered a black eye to both ends of Brazil’s political spectrum.

A range of business leaders, political figures, regulators and judges have been swept up in the scandal.

A mid-sized lender, Banco Master grew aggressively over the last decade by selling high-yield deposit certificates. Some of those certificates offered returns of up to 140 percent relative to Brazil’s benchmark interbank rate.

But Banco Master did not have the assets needed to sustain that output.

It lacked the money to pay back its risky loans, and what assets it did have were diverted to shell accounts, according to prosecutors.

Brazil’s Central Bank ultimately liquidated Banco Master in 2025, as the lender faced a major funding squeeze.

Its owner, Daniel Vorcaro, was subsequently arrested, accused of an array of financial crimes, including money laundering and fraud.

The collapse of Banco Master triggered a nearly $7.7bn payout from Brazil’s Credit Guarantee Fund, the largest disbursement in the nonprofit insurance’s history.

Investigators have suggested that Vorcaro protected his fraud scheme by cultivating influence among power brokers among Brazil’s elite.

Among those implicated in the scandal is Senator Flavio Bolsonaro, the presidential candidate.

Last month, the Supreme Court unsealed documents showing he is under investigation for alleged corruption and money laundering in connection with Vorcaro.

Audio recordings have also surfaced, appearing to show Bolsonaro soliciting the disgraced bank leader for millions in funding. The money was slated as financing for Dark Horse, a film about his imprisoned father, Jair Bolsonaro.

Flavio Bolsonaro has denied any wrongdoing. He described the interaction as a private sponsorship opportunity, unrelated to the Banco Master scandal.