Santander canceled a plan to appoint Brazilian executives as chief accountant, and was investigated by police for nearly four months after he was suspected of fraud while working in Brazil's largest bank.
Alexsandro Broedel Lopes joined Santander in October and was scheduled to become its group's chief accounting officer in the coming months, which will make him a member of its senior management team.
But in a memo to senior executives on Wednesday, the bank said Manuel Preto, deputy chief executive of its Portuguese operations, would take on a major accounting position by the end of July.
After the Federal Trade Agency (FT) revealed in February that he decided to revoke the brother's appointment after a criminal investigation in São Paulo, due to allegedly allegedly stolen funds while working in Brazil's largest bank Itaú.
Santander did not give a reason to appoint Preto instead of a brother. One person briefing the matter said Bradell remained a Santander employee.
Itaú accused its former chief financial officer Broedel of making Siphoning funds from banks through arrangements with external consultants he hired on behalf of lenders. The Federal Trade Association previously reported that St. Paul's prosecutors believe that a police investigation of senior executives is needed to "determine the facts."
The Santander board agreed to the brothers' appointment as group chief accounting officer last June, and the allegations were revealed.
The bank previously said the brothers had obtained necessary approval from regulators to hold senior positions in Santander. This includes passing the ECB's "fit and appropriate" test of senior management.
After the first publication of the criminal investigation of the brother, Santander said the brother was a "respected senior director" and "will take over the CAO later this year." It added that it is "monitoring any development".
The brother has not been charged with any crime and the results of the police investigation are unclear.
A spokesman for Santander and brothers declined to comment on Wednesday's memo.
The brother's representative previously described the allegations against him as "baseless and meaningless", adding that he "has been conducting his own actions morally and transparently in all his activities during his 12 years in Itaú".