Brazilians voted in the first round of the country’s presidential election on Oct. 4, sending Sen. Flávio Bolsonaro—the eldest son of former President Jair Bolsonaro—and President Luiz Inácio Lula da Silva to a runoff. Another key race was decided that day: In congressional elections, right-wing parties triumphed and are expected to hold at least 45 of 81 seats in the Senate.

Brazil’s Senate confirms (and can remove) justices on the Supreme Court, whose expanding judicial reach has made it a central arbiter of Brazilian democracy. Decisions by the bench could yet shape the outcome of the runoff, set for Oct. 25.

On Sept. 15, Chief Justice Edson Fachin convened a televised session to decide whether Justice Alexandre de Moraes—who oversaw Jair Bolsonaro’s prosecution and is reviled by the far right—should be investigated by the Federal Police. (Brazilian law requires courts to authorize investigations into their own members.) The justices never reached a decision: They split on a procedural motion, with Moraes voting on his own case, before Justice Flávio Dino asked for up to 90 days to study the file. That clock runs until mid-December—well after the runoff.

The case swirling around Moraes stems from the collapse last year of Banco Master, a midsize Brazilian lender. The scandal—like the Operation Car Wash investigation of the mid-2010s—has ensnared many members of Brazil’s political and business elite. Federal Police hope to examine whether Moraes improperly assisted Master’s controlling shareholder, Daniel Vorcaro, and whether that conduct was connected to a legal services contract between Master and Moraes’s wife’s law firm. Moraes denies wrongdoing. He has not been charged with a crime.

The scandal has become a hot topic on the campaign trail, and one likely to benefit Flávio. By putting off a decision on whether to investigate Moraes, the Supreme Court has handed Flávio a rallying cry, left Lula defending an institution that he has no plan to reform, and made the new right-wing Senate the arbiter of the court’s future.

Prior to its collapse, Banco Master held only 0.57 percent of Brazil’s banking assets. But its unique business model made it significant.

The bank sold certificates of deposit paying up to 140 percent of the interbank benchmark rate, far above what large banks offered. It leaned on the Credit Guarantee Fund, an insurer financed by member banks that covers up to about $49,000 per investor. (Although privately funded, the fund operates under government-set rules, and eligible banks are required to join and contribute.) This allowed Master to raise money without investors scrutinizing what it bought, including illiquid assets and credit portfolios that, according to investigators, lacked adequate backing.

Master also drew on public money. Banco de Brasília (BRB), a lender controlled by the government of the Federal District, bought Master’s credit portfolios. In March 2025, BRB agreed to buy 58 percent of the bank. The Central Bank blocked the deal that September and shut Master down on Nov. 18. The Credit Guarantee Fund repaid roughly $7.5 billion to about 800,000 savers, so taxpayers did not cover that bill. But BRB’s losses fall on the public: Federal Police found that BRB paid about $1.4 billion for Master portfolios before finishing at least one of its required risk assessments. BRB has since asked the district government for fresh capital.

Master’s reach went beyond finance: Vorcaro told police that he had friends in all branches of government, and the case has drawn in politicians across the political spectrum.

Ibaneis Rocha, the former Federal District governor, called the occasion of the proposed acquisition “a day of celebration,” and he left office in March to run for the Senate. He dropped out of the race in July, after the BRB president whom he had appointed was jailed.

Police say Master’s staff drafted an amendment to a proposed constitutional reform to quadruple the Credit Guarantee Fund’s per-depositor coverage that Sen. Ciro Nogueira, Jair Bolsonaro’s former chief of staff, introduced in Congress in 2024. Police have also said that Nogueira received monthly payments of up to roughly $98,000 from Vorcaro and figures associated with Master. Nogueira denies wrongdoing.

The Supreme Court took over the Master investigation because it involves members of Congress, who in Brazil can only be investigated with the Supreme Court’s authorization—and tried by the court itself. Justice Dias Toffoli was initially assigned to the case. He stepped aside in February after police flagged that funds managed by Vorcaro’s brother-in-law had a stake in a resort from a company partly owned by Toffoli and his brothers. Toffoli’s office has said he never had a friendship with Vorcaro.

The case was then reassigned to Justice André Mendonça, a Jair Bolsonaro appointee.

The scandal has reached both presidential campaigns, though not in the same way. Flávio’s exposure is direct: In May, Intercept Brasil published audio of him asking Vorcaro for money to finish Dark Horse, a biopic about his father. Flávio first denied any connection to Vorcaro, then acknowledged seeking the sponsorship, which he described as legitimate private investment.

Records from Brazil’s financial intelligence unit trace about $12.3 million from a Vorcaro-linked company to a Texas fund that managed the film’s money and is run by an ally of Flávio’s brother Eduardo, who successfully lobbied the Trump administration to sanction Moraes. Police documents do not link the money to Flávio’s personal accounts. In July, Mendonça authorized a formal investigation into possible corruption, money laundering, and currency evasion connected to the financing of Dark Horse. Neither brother has been charged in connection with the film’s financing.

Lula’s exposure is indirect. He is not implicated in wrongdoing, according to tax records reviewed by Reuters, though he met with Vorcaro in December 2024. This June, police executed search warrants targeting Sen. Jaques Wagner, who was then the Senate leader, on suspicion that he had advanced Master’s interests in exchange for benefits for relatives. Wagner, a member of Lula’s Workers’ Party, denies wrongdoing. He has since resigned from his leadership post.

For Lula, the larger liability is Moraes. Much of the Brazilian electorate places the justice and the president in the same camp—never mind that Moraes was appointed by right-wing former President Michel Temer.

Flávio has campaigned on the perceived link, saying, “Anyone voting for Lula is voting for Alexandre de Moraes.” Lula has responded by demanding an investigation of everyone implicated in the Master scandal, “no matter who it hurts.” Moraes is also a frequent target of tech entrepreneur Elon Musk, who called him an “evil dictator cosplaying as a judge” during a 2024 clash over court orders that led to X’s temporary suspension in Brazil.

Banco Master signed a three-year legal services agreement, potentially worth roughly $25.7 million, with a law firm where Moraes’s wife is partner. Federal Police investigators have said that metadata from a draft of the agreement shows a username linked to the justice, which they read as a sign that he edited the document. The firm says Moraes reviewed the contract only for potential conflicts of interest and that it never represented Master in court. Editorials in three major Brazilian newspapers have called on him to step down.

Master’s access extended deep into Brazil’s legal and law enforcement establishment. In April 2024, Master sponsored a forum in London and paid for the appearance of former British Prime Minister Tony Blair, who debated Vorcaro. Participants included Moraes, Justices Gilmar Mendes and Toffoli, Prosecutor General Paulo Gonet, and Federal Police Director-General Andrei Rodrigues. Messages on Vorcaro’s phone show him telling an associate that he needed to run the guest list by “Alexandre.”

The Federal Police report records Vorcaro’s claim, but it notes that investigators did not confirm with Moraes whether he had requested or approved the list. Should proceedings against Moraes move forward, every office that would have to investigate, charge, or judge him for potential wrongdoing was represented in that London room.

The court’s paralysis has become a campaign asset for Flávio. Every week without a ruling on Moraes lets Flávio attack the court further.

But it’s unclear whether the scandal has truly impacted the presidential race. In a survey conducted Sept. 8-10 by the polling firm Datafolha, 85 percent of respondents said the Moraes revelations had not changed their vote; 4 percent reported changing their choice, while another 7 percent said the revelations had left them uncertain. The same survey found that 76 percent think that Brazilian Supreme Court justices have too much power.

The Senate is where the court’s future will be settled. Jair Bolsonaro picked allied candidates to build a majority capable of impeaching justices, which requires two-thirds of the Senate, or 54 votes. Counts of incoming senators who back impeachment range from 48 to 54, depending on the survey. Flávio has promised to limit rulings by individual justices, end the court’s original criminal jurisdiction over members of Congress, and pursue amnesty for his father, alongside Moraes’s impeachment. Lula has proposed no structural change to the court.

Either way, the next president will likely appoint four of the court’s 11 justices. (Brazilian Supreme Court justices must retire by the age of 75.) One seat has been empty since April, when the Senate rejected Lula’s nominee, Jorge Messias—the first such rejection since 1894. Three more seats will open through mandatory retirements by December 2030.

The deeper problem will outlast the runoff. In 2024, I argued that Brazil’s democracy, for all its defects, was in no danger of falling apart, and I still believe that. But my view of the court has moved more in the past year than in the previous 10. Allegations against a justice are investigated under the court’s supervision, charged by the prosecutor general, and tried by colleagues. In this case, the prosecutor general appears in the evidence.

That loop has structural roots. In 2025, the court issued 116,170 decisions, and around 80 percent of them came from individual justices. The scholars Diego Werneck Arguelhes and Leandro Molhano Ribeiro call the pattern ministrocracia, or rule by individual justices. The court also writes its own conduct rules. In 2023, it struck down a statute barring judges from cases involving clients of their relatives’ law firms. The National Council of Justice, which disciplines the rest of the judiciary, has no jurisdiction over its members.

Complacency would leave that loop intact, but a court purged by a Senate eager for revenge is no guarantee of accountability. The Senate has never removed a justice, and the first impeachment would set a precedent that any future majority could invoke.

Most of the remedy lies in the court’s own hands. It could require justices to step aside from cases involving themselves or their relatives—which Moraes did not—send major rulings by a single justice to the full court; and assign cases at random, with no exceptions.

“Either we limit ourselves,” warned Fachin, the chief justice, in January, “or there may be limitation by an external power.”

Whoever wins Brazil’s presidency will inherit four Supreme Court seats to fill; a decision on Moraes due in December; and a public that, by roughly 4 to 1, thinks that the justices have too much power. The question for Brazil’s next government is not whether the Supreme Court will be constrained, but who will write those constraints.