Santander scraps plan to appoint executive under criminal investigation

Unlock the Editor’s Digest for free

Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.

Santander has scrapped a plan to appoint a Brazilian executive as its chief accountant, nearly four months after he was placed under police investigation for alleged fraud while working at Brazil’s largest bank.

Alexsandro Broedel Lopes joined Santander in October and was due to become its group chief accounting officer in the coming months — a position that would have made him a member of its senior management team.

But in a memo to senior managers on Wednesday seen by the Financial Times, the bank said that Manuel Preto, deputy chief executive of its Portuguese business, would instead take on the chief accounting role at the end of July.

The decision to drop Broedel’s appointment comes after the FT revealed in February that he was under criminal investigation in São Paulo for alleged misappropriation of funds while working at Itaú, Brazil’s largest bank by total assets.

Santander did not give a reason for appointing Preto instead of Broedel. A person briefed on the matter said Broedel remained a Santander employee.

Itaú has accused Broedel, its former chief financial officer, of siphoning funds from the bank through an arrangement with an external consultant who he had hired on behalf of the lender. São Paulo prosecutors decided a police investigation into the executive was needed to “determine the facts”, the FT previously reported.

Santander’s board of directors agreed to Broedel’s appointment as group chief accounting officer last June, before the allegations came to light.

Broedel had received the necessary approvals from regulators to take up the senior post at Santander, the bank previously said. This included passing the European Central Bank’s “fit and proper” test for senior managers.

After the criminal investigation into Broedel was first made public, Santander said Broedel was a “highly regarded senior executive” who was “due to take over as CAO later this year”. It added that it was “monitoring any developments”.

Broedel has not been charged with any crime, and the outcome of the police investigation is not yet known.

Santander and a spokesperson for Broedel declined to comment on Wednesday’s memo.

Broedel’s representative previously described the allegations against him as “unfounded and meaningless”, adding that he “has always conducted himself ethically and transparently in all his activities throughout his 12 years at [Itaú]”.