Parmalat CEO points finger at creditors

By staff reporter

- Last updated on GMT

Related tags: Parmalat, Bank of america

Parmalat's chief executive Enrico Bondi has pointed the finger at
the company's creditors, accusing them of having knowledge of the
disgraced dairy giant's finances.

Testifying at the trial of Parmalat's founder and former chairman, Calisto Tanzi, he said that he had the impression that the company had been protected by its creditors while it plunged headfirst into financial disaster.

Parmalat went into administration in December 2003 following the revelation that a key account with Bank of America did not exist. Holes in the firm's accounts hid the fact that the company was a whopping 14 billion in debt.

Since then, Milan magistrates have been investigating suspected financial crimes associated with the scandal. Tanzi, the founder of the scandal-hit dairy, faces charges of false accounting and share price manipulation.

Reuters reports that Tanzi told reporters his conscience was "serene."

Bondi is central to both the trial and the dairy firms ongoing resurgence. He was appointed by the government to rescue the company after the fraud was exposed in 2003, and was elected chief executive in autumn last year.

Bondi has already claimed 8.07 billion in damages in lawsuits filed against the group's auditors and banks. Parmalat has also sued banks JPMorgan Chase and Unicredito Italiano for 4.4 billion for their roles in the sale of Parmalat bonds issued from 1997 through 2001.

Financial institutions however have maintained that they were fooled by Parmalat's fraud. The foreign banks implicated so far include Citigroup and Morgan Stanley, Germany's Deutsche Bank and Swiss bank UBS.

The banks have all denied wrongdoing in Parmalat's collapse.

Under Italian law, companies can stand trial, and can be forced to close if found guilty.

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