Fraud Investigators Search Home of Parmalat Founder
Police investigating fraud in the Parmalat scandal searched through the home of the food giant’s founder Wednesday, the same day that the flailing company tried to save itself by formally filing for bankruptcy protection.
Police said they had raided the home of Calisto Tanzi to hunt for evidence that might help explain the stunning near-collapse of a company that had been a model of Italian industry. Tanzi was not there, and reports said he had left the country.
Also on Wednesday, the Industry Ministry appointed a business-turnaround expert to develop a restructuring plan to rescue the Parma-based company, which employs thousands worldwide.
The case, dubbed by some as “Europe’s Enron,” has shaken this country’s business leaders, who for years touted Parmalat as a proud symbol of northern Italian, family-run enterprises that help drive the economy -- among them the Fiat automaker in Turin, the Benetton apparel company in Treviso and Premier Silvio Berlusconi’s Mediaset in Milan.
Since the scandal broke Friday, evidence has mounted of a vast hole in the company’s balance sheet. The latest Italian reports said the total missing from Parmalat accounts could be about $12 billion after a pattern of false accounting that may have dated back 15 years.
The scandal has raised questions about Italy’s regulatory framework. Premier Silvio Berlusconi has said the case damaged the country’s credibility and reputation, and his government promptly intervened Tuesday with a bankruptcy protection law tailored to save Parmalat and the jobs of 36,000 people it employs in 29 countries.
The government on Wednesday appointed Enrico Bondi, who became Parmalat chief executive this month after Tanzi was ousted, to the post of special commissioner under the bankruptcy protection plan.
Bondi, who has a reputation as a corporate savior after rescuing chemical group Montedison from bankruptcy in the early 1990s, must draw up a restructuring plan, to be approved by the Industry Ministry.
Prosecutors have placed Tanzi and 20 other officials, including former finance directors, under investigation for possible fraud and other charges concerning the suspected falsification of company documents.
The financial police branch searched Tanzi’s home near Parma for several hours Wednesday, hauling out boxes of documents. The founder’s son Stefano said he didn’t know where the elder Tanzi was.
The elder Tanzi has kept a low profile and has not offered a public defense since the scandal broke.
The scandal exploded Friday after Parmalat revealed that Bank of America Corp. was not holding about $4.9 billion of its funds, as the Italian company had reported in September. Since then, the estimated amount of money missing from the balance sheet has ballooned.
