A bombshell leak threatens Flávio Bolsonaro’s election bid

On May 13th Intercept Brasil, a left-leaning investigative outlet, published messages exchanged between Flávio Bolsonaro, the leading presidential candidate of the Brazilian right going into the general election in October, and Daniel Vorcaro, a disgraced banker at the centre of Brazil’s largest-ever bank fraud. The messages show Flávio asking Mr Vorcaro to complete payments related to the financing of a film about his father, Jair Bolsonaro, Brazil’s right-wing populist former president, who is serving a 27-year prison sentence for attempting to mount a coup in 2022.

Right-wing parties immediately started talking about fielding an alternative candidate. On betting markets, where Flávio had been favourite to win the presidency, he plunged into second place by ten points. The Brazilian real and the main stock index both fell 2% as the prospect of victory rose for President Luiz Inácio Lula da Silva, the spendthrift left-wing incumbent.

Mr Vorcaro has become radioactive in the past year. Trouble began when he tried to sell his bank, Banco Master. He couldn’t find a buyer. Banco de Brasília (BRB), a lender owned by the local government of the capital district, offered to step in. Yet when the regulator studied the merger, it found that Banco Master was essentially a Ponzi scheme. Mr Vorcaro was arrested in November as he tried to board a private jet to Dubai. The former president of BRB was also detained after evidence emerged that he had received bribes worth $30m from Mr Vorcaro. The central bank has liquidated Banco Master. Brazil’s deposit-insurance fund is reimbursing investor losses of $11bn, about half of the fund’s total assets.

As investigations into Mr Vorcaro have deepened, few in Brasília have been spared. Mr Vorcaro was more focused on running an influence-peddling scheme than a bank, building close ties with Supreme Court justices, politicians of all stripes and some officials at the central bank. He bought favours for years by splashing out on parties for politicians, flying in prostitutes from Russia, Ukraine and Venezuela on private jets. In one text message to his former girlfriend, Mr Vorcaro explained that he had hosted parties with 300 sex workers because it was part of “business”. As his fortunes turned, he prodded underlings to spy on government officials and smear adversaries. Brazil’s voters hate it. As the scandal unfurls, corruption has become their primary concern.

For months Flávio has publicly denied any links to Mr Vorcaro. In March he was questioned about the fact that the largest private donor to his father’s re-election campaign in 2022 had been Fabiano Zettel, Mr Vorcaro’s brother-in-law and financial front man. Flávio told reporters that the donation was made “without strings attached, without quid pro quo, and without any personal contact whatsoever” between the Bolsonaros and Mr Vorcaro. As late as the morning of May 13th Flávio denied links to the banker. The messages were published a few hours later.

In one message sent in September last year Flávio says to Mr Vorcaro: “I feel bad about constantly nagging you, but this is a very critical moment in the film, and since we’re so far behind schedule, everyone is worried.” In another text, sent the day before Mr Vorcaro was arrested, Flávio wrote: “Brother, I am and will always be with you; there’s no beating around the bush between us. I just need you to give me a heads-up! Hugs.” By that point, Banco Master’s dealings were well-known.

Flávio denies any wrongdoing. In a statement after the leak, he finally acknowledged his ties to Mr Vorcaro, but said that “What happened in our case was a son seeking PRIVATE sponsorship for a PRIVATE film about his own father’s life.” This did not appease his supporters. On Instagram, many bolsonaristas fumed. “Fuck, man, go home. Everything’s fucked now, damn it,” exclaimed one. Other right-wing candidates could hardly believe their luck. Romeu Zema, a technocratic former governor of Minas Gerais who intends to run for president, released a video scolding Flávio: “Hearing you ask for money from Vorcaro is unforgivable. It’s a slap in the face of all decent Brazilians.”

According to the documents published by Intercept, Mr Vorcaro had agreed to pay $24m to finance the production of “Dark Horse”, a biopic about Mr Bolsonaro due to be released weeks before the general election. Around $10.6m had been paid out before Mr Vorcaro’s troubles began. Some of the money flowed through accounts owned by a lawyer for Eduardo Bolsonaro, Flávio’s brother, who moved to the United States last year to lobby Donald Trump to block his father’s criminal case.

Flávio’s allies hope continuing Banco Master investigations will ensnare more politicians from the ruling Workers’ Party. The bad news has been piling up for the right. On May 7th Lula, as Brazil’s president is known, met with Mr Trump at the White House for three hours. Afterwards Lula talked up their “chemistry” and said their relationship was like “love at first sight”. On a phone call before the meeting, Mr Trump reportedly told Lula “I love you”. This sits uneasily with the Bolsonaros, who have boasted of being pals with Mr Trump.

While Lula was at the White House, police in Brazil raided properties owned by Ciro Nogueira, a powerful senator and Jair Bolsonaro’s former chief of staff. Mr Nogueira had introduced an amendment in Congress that would have helped Banco Master’s business. Mr Vorcaro paid him a monthly allowance of up to $100,000. Mr Nogueira denies wrongdoing. Mr Vorcaro had described him as “a great friend” in text messages. In texts to Flávio, he preferred the term “big brother”. ■