SEC May Expand Parmalat Case

The Securities and Exchange Commission may expand its lawsuit against Parmalat amid a probe of all aspects of the scandal engulfing the Italian food group, a top official said Tuesday.

“It is possible that we will amend the complaint,” said Lawrence West, the enforcement official overseeing the Parmalat case.

Whether any expanded SEC legal action would extend to banks linked to the Parmalat affair was unclear, but West said the SEC’s investigation was leaving no stone unturned.

“We are definitely investigating all possibilities, all activities in the United States,” said West, who returned recently from Italy, where he met with Italian prosecutors and officials from the Italian stock market regulator, Consob.

In New York, a spokeswoman for Manhattan Dist. Atty. Robert Morgenthau confirmed that his office was investigating at the request of the SEC and Italian authorities.

Authorities have searched the Manhattan home and offices of Giampaolo Zini, a lawyer for Parmalat founder Calisto Tanzi, Morgenthau spokeswoman Barbara Thompson said.

She said documents referring to Parmalat had been seized and records on Parmalat shell companies were being sought.

The U.S. attorney’s office in Manhattan, headed by interim U.S. Atty. Gen. for the Southern District of New York David Kelley, also is deeply involved in the case, according to sources familiar with the matter.

Italian prosecutors Tuesday continued investigating Parmalat in what has become Europe’s largest corporate scandal in years, leading to arrests of several executives.

The SEC has charged Parmalat with securities fraud. Over five years, the SEC said, Parmalat “induced U.S. investors to purchase bonds and notes totaling approximately $1.5 billion.”

Asked about the possible involvement of U.S. banks in transactions with Parmalat, West said, “I won’t address those specifically. I’ll just say we’re addressing all aspects.”

He said the SEC’s probe did not extend into Italy itself.

“We’re investigating in the United States. We’re cooperating with the Italians,” he said.