Brazil Audit Court Orders Probe Into Liquidation of Banco Master

A member of Brazil’s audit court ordered an investigation of the central bank’s procedures that were used to liquidate Banco Master SA, a move that risks undermining the legal certainty of the bank’s regulatory rulings in Latin America’s largest economy.

In his decision, Minister Jhonatan de Jesus wrote that the inspection of related central bank documents should move swiftly to clarify the “motivation, coherence and proportionality” behind its decision to dismantle the financial institution.

The investigation does not reverse the liquidation of Master, but opens the door to that possibility. De Jesus has not ruled out that “precautionary measures” ...