Parmalat hearing opens in Milan

- Last updated on GMT

Related tags: Dairy giant parmalat, Calisto tanzi, Italy, Parmalat

A pre-trial hearing has opened this week in Milan to determine if
and how the founder of Italian dairy giant Parmalat, Calisto Tanzi,
should be brought to trial along with over 24 former company
officers, consultants, and ex-auditors, as well as three financial
institutions.

At the closed hearing today applications from investors will be heard to become civil parties to the market-rigging and fraud case, a status that will enable them to seek compensation from any parties found guilty.

A Financial Times​ report quotes the case of an investor, a 64-year-old housewife from Milan, seeking to salvage her life savings of €78,000. "In 2000, the bank advised me to buy Parmalat bonds,"​ she said, now living with her husband on €600 a month.

The insolvent and fraud-racked dairy and food giant with revenues of €7.5 billion in 2003 fell into trouble last December after it revealed a €4 billion hole, now stretched to more than three times this figure, in its accounts.

Reports suggest that Parmalat's administrator Enrico Bondi is aiming to claim "very substantial" damages from the failed company's former executives and others.

Bondi was named to head Parmalat after the company was placed under special administration in December after running up debts totalling €14.27 billion.

The Italian firm has laid cases against several big international banks, claiming heavy damages with interest, alleging that the banks had acted improperly as the company headed towards collapse because about €14 billion was missing from its accounts.

Parmalat is claiming €8.06 billion from US bank Citigroup, as well as smaller claims from Swiss banks UBS and Credit Suisse.

Related topics: Manufacturers

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